HELOC on primary residence for buying rentals - why not?

HELOC on primary residence for buying rentals - why not?

Rental Property Investor · Delray Beach, FL · Member since 2017 · 102 posts · 44 votes
Hey BP, My wife and I just bought our first three units earlier this year (turnkey). We have quickly realized why the BRRR strategy is awesome for being able to scale faster. It will be some time before we have enough cash to buy a property in cash and fund rehab costs. However, with the renovations we did on our primary residence and the increases in the market, we could probably access around $100k of equity thru a HELOC. I understand the risk of having the HELOC maxed out when the market starts to decline, but what about just using it as supplemental funds for acquisition/ rehabs and then paying it mostly down after refinancing the properties..any negatives?
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  • Harjeet BhattiPro Member
    Lender · Glenview IL- CDLP NMLS#230554 · Member since 2015 · 2k+ posts · 747 votes
    8y

    @Brian Dickerson HELOC can be used for short term loan and that's the way to go for short term loan like flipping. Its saves lot of closing cost.

  • Rental Property Investor · Delray Beach, FL · Member since 2017 · 102 posts · 44 votes
    8y
    Sorry for the huge paragraph...the BP app removed my spacing when I posted this ,will fix later.
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