HELOC on primary residence for investment of rental?
Hey everyone,
2nd post here on BP and a newbie to RE investing. I've been soaking up info like a sponge through these forums, BP Podcast, and some audiobooks, as well as doing some research on Zillow, Trulia, etc. Here's my situation:
I'm looking through my options for capital on a single or multi-family rental property. I have some cash in savings, but I'd like to keep that on hand should any emergencies arise. Let's say my primary residence is valued at 650k and my mortgage is 350k. A quick HELOC calculator check from Chase.com tells me that at 80% LTV, I may qualify for up to 170k in credit. I most likely won't be taking that much, as I'd like to get my feet wet on my first investment with a down payment of 20k plus an extra 10-15k on rehab/reserves. My question is, if we were to move from our primary residence 1-2 years after the HELOC, how does the credit payback work, if at all? Can some of the profit from the sale be used to pay back the credit? Also, if anyone has had good/bad experiences with a HELOC please share.
I'm amazed at the wealth of information that can be found on these forums and the knowledge that all of you bring. I appreciate any and all of the feedback/advice that you give and I'm extremely grateful that I have found this community! Thanks again!