How can I get over $50k in a line of credit?

6 Replies

There are a few cash offers in my area that I would like to take advantage of but I don’t have the cash to do so and rehab. Is it possible to get a line of credit of $50k or more? If so, how? My credit score is 700+

@Byron Bailey

Do you understand what debt and equity are?

I'd recommend you dig into that, by doing some basic youtubing and googling.  From your question I doubt that you understand that (no offense).

Basically, you need collatoral generally speaking to get a loan, even a HELOC. That's basically the leverage your lender would have (ie: they take the house, car, etc) if stuff 'hit the fan' and you didn't make payments.

So, do you currently own? If you do, do you have equity in what you own? If you answered yes, then you may be able to get a LOC.

I understand the difference. I was wondering more in the sense of credit card line of credit or if there are other sources to get lines of credit outside of using equity in an already purchased asset.

I disagree with @Jim Goebel . I currently have 2 lines of credit that are unsecured from my local credit unions. One for 30k and the other for 15k. The 30k line was established with the credit union I do my personal banking with and it took about 20 minutes to apply and get accepted. The other I applied and by the next day it was approved.

I was surprised when I first started getting these because it just looks too good to be true. I will say that when they pull your credit report they will be concerned if they see several lines of credit opened recently. The second credit union tried giving me only 5k initially and when I asked why they told me it was because of the other recently opened like of 30k. I explained that I meant to use these to do repairs in a rental as I wait for the refinance and they said "ok" and approved. Credit unions and small banks are very relationship driven and will work with you.

I have since used both lines and some personal savings to buy properties in cash and refinance them. Note that most refinancing inside 6 months only allows you to get the original purchase price out plus closing costs. You will likely not be able to refinance rehab costs within 6 months. So make sure you have the reserves to pay the credit line's minimum payment for the time required.

Quick hack - Some credit unions will tell you their maximum unsecured credit line is 10-20k. But sometimes this is a limit per "account" since you usually have to open a checking account. I've seen people simply open 2 accounts and get approved for 2 credit lines for the maximum.

The interest rates are around 9% on both lines.

Good luck.

Thank you so much @igor messano!! Just the advice I was looking for. What all did they ask you on the line of credit application?

Very general personal information such as, employment and salary, personal information for credit report checking, assets and other income. Similar to a credit card application. For both I didn’t have to provide anything besides my personal info. No backup for income or assets.

@Igor Messano

Thanks for the clarification and yes I forgot to mention the possibility of unsecured debt.  We haven't been down that road.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here