Starting rental business

Member since 2026 · 3 posts · 0 votes

Looking at getting started we don’t have enough for the initial down payment of 20%. We are in our low 30s and own a home. Our bank suggests we can take a lien out on the house we own. Or do we wait another 1.5 years to save the money ourselves. We currently have approximately 30k to put down. we are looking to start with a duplex

We appreciate anyone recommendations and advice.

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Jacob CamhiBusiness Member
Hinton, WV · Member since 2026 · 132 posts · 40 votes
2mo
it's smart to think through financing options when starting out. using your primary home's equity, often through a home equity line of credit (heloc), is a common way investors get their first rental. it can certainly help you avoid waiting a year and a half to save more.
before you commit, i'd really dig into the numbers for duplexes in your area. you can usually find recent sales prices and rental income on county assessor records or by looking at listings on public real estate sites. run your projected expenses, including that heloc payment, to make sure it's a solid deal. sometimes, a slightly higher interest rate now is better than waiting and missing out on market appreciation.
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Austin GoetzBusiness Member
Lender · Minneapolis, MN · Member since 2026 · 22 posts · 6 votes
5d
You may not necessarily need to wait until you have 20% down. Some DSCR loan options allow as little as 15% down on eligible 1–4-unit investment properties, including duplexes, depending on qualifications like FICO score and type of rental (short or long term). These loans qualify primarily based on the property's rental income rather than your personal income.
A HELOC could also be an option especially if you have a low rate on your primary. Depending on your available equity and current mortgage rate, a cash-out refinance may be worth comparing. Cash-out financing on a single-family primary home is capped at 80% of its appraised value, with your existing mortgage paid off from that amount. Since it replaces your current mortgage, you'd want to compare the new rate and costs carefully.
Is that $30K saved strictly for down payment or is that money going to be used for any potential repairs and reserves? What price range are you considering?

Happy to connect and dive deeper to any questions you have. Feel free to message me.
[email protected]952-797-2007
Magnolia Bank
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Caleb Brown
Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes
5d
Can you move out of your current house and owner occupy the duplex? Not the most exciting to do but would be feasible
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