Does this HELOC offer sound favorable?

Question

Hey BP!

So i finally received an update on my HELOC im trying to open up for investment purposes.

I saw someone post on here awhile back about Huntington bank being a great institution for opening up a HELOC. I went thru the process and the terms came out to be 77k @ 6.3% variable APR. Does this sound like a reasonable rate (market rate is around 6%?). The terms of the HELOC are interest only payments with a 10 year draw. I was more inclined to use the interest only payments for BRRRR buy and holds, but i have also been thinking about using the HELOC as a 20% downpayment on multi unit buildings if the purchase price was right (and then paying down the HELOC with cashflow and a possible cash-out refi down the road). Is a interest+principle HELOC better for the multi unit strategy or is interest only payments better overall?

Any input is greatly appreciated! I currently own a 4-unit multifamily (purchased with 20% savings as DP) and want to add to my portfolio ASAP! I love the BRRRR strategy but deals are hard to come by in decent neighborhoods with the amount of credit i can take out. That is why i also including the thought of using the HELOC as a down-payment (20-25%) on another multi-family. I also have read that seasoning the downpayment in my checking account is required if conventional funding is wanted. Do all banks require this, i figured that if i got the money from my equity there would be no issue.

Thanks,

Tom Kaz · Answer

doing some more research, is this HELOC rate at 6.3% seem high? Should i try looking elsewhere? My credit was already pulled with this institution.