Purchasing rental with a HELOC
There is a house I am looking at that is "cash only" because it is not finished so the banks will not give me a mortgage on it. I could pay for the house with a HELOC but still unclear about how much the rehab would be. If I were to buy it with cash then rehab it and the ARV was more than I put into it what would be my next step? Can I do some type of "cash out" loan to replace the funds back into my HELOC?
My husband and I are brand new to investing so not quite sure about the best financing route. It is across the street from a lake and should be easy to rent out.
Any feedback is welcome. Thank you!
Most Popular Reply
Look at construction financing with a small local community bank.
Save the HELOC for emergencies rather than charge it up, as it acts like a credit card and can make refinancing difficult when/if debt to income gets too high.