Real Estate Agent · Ventura, CA (Ventura) · Member since 2021 · 46 posts · 17 votes
4y
Hi @Byron Bailey this is a great question. I think first and foremost. Get your credit score right. Don't pull out lines of credit. Make sure you don't have any outstanding debt. After a couple of months go to a lender and apply for a home equity line of credit.
Now you have two options:
1) Home Equity Loan
2) HELOC
These are both backed by your home and allow you to borrow. #1 allows you to borrow a certain amount of funds with a fixed rate (usually pretty low). #2 Is like a credit card. You have a certain amount of time to draw money from the line of credit that they approved you for. During that time it's usually an interest-only period. Then after your "draw period," you have a period where the principal kicks back in and you have to pay both principal and interest.
I would look into both of these and understand them more. See where you stand and what you feel comfy with.
I think the key difference between the both of them is that #1 is a lump sum of money and a fixed rate. #2 is you take as you need and interest is adjusting all the time.
Hopefully, this helps, and best of luck in your adventures.
Lender · Teaneck, NJ · Member since 2021 · 31 posts · 7 votes
4y
@Byron Bailey As investor and lender, we find Rental Loans based on DSCR as a great alternative to conventional rental loans. It takes 3-4 weeks from start to finish and limited documentation requirements. All you need is Rental income, taxes, insurance and sensible FICO score to qualify. No income or Asset Verification, No paystubs, etc. Rates are around 4% for Higher FICO borrower and not too high leverage.