HELOC on Rental Proterties

Member since 2019 · 3 posts · 1 vote

My banker asked me to put together a P&L in order to qualify for a HELOC I am applying for on 3 of my rental properties to fund a flip. I am curious if anybody has prepared one of these and has a template to go off of? I am curious if I am missing any line items on the expenses.

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Brittany MinocchiBusiness Member

Lender · Massillon, OH · Member since 2022 · 1k+ posts · 486 votes

Quote from @Ali Nichols:

Following this because I've had a hard time finding anyone who will HELOC on an investment property.

If it's a single family property and not in an LLC, there are a couple lenders I know of that'll do HELOCs. Otherwise, you should have better luck with a closed end second (HELOAN). Multiple lenders doing those with various types of income verification (full doc, DSCR, bank statement).

[email protected]330-354-6590

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Ali Nichols
Investor · Member since 2022 · 235 posts · 127 votes
3y
Following this because I've had a hard time finding anyone who will HELOC on an investment property.
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Brooklyn Taylor
OP
Member since 2019 · 3 posts · 1 vote
3y
thank you, my local bank does them.
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Edward Adams
Investor · Houston, TX · Member since 2020 · 111 posts · 64 votes
3y
My local bank also provide HELOC on investment.(it just need to be paid off) they provide me with the form to fill out every year. just ask them and they should be able to send you a empty form to fill out.
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Kevin Sobilo
Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes
3y
@Brooklyn Taylor, this is why I'm glad I broke down and hired a bookkeeper. When I need something like that I can literally turn it around and have it emailed back out to my lender in just a couple minutes because its just a matter of running a report in quickbooks.
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Brittany MinocchiBusiness Member
Lender · Massillon, OH · Member since 2022 · 1k+ posts · 486 votes
3y
Quote from @Ali Nichols:

Following this because I've had a hard time finding anyone who will HELOC on an investment property.

If it's a single family property and not in an LLC, there are a couple lenders I know of that'll do HELOCs. Otherwise, you should have better luck with a closed end second (HELOAN). Multiple lenders doing those with various types of income verification (full doc, DSCR, bank statement).
[email protected]330-354-6590
Brittany Minocchi - Barrett Financial Group, LLC520 Reviews
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Ragan Manning
Accountant · Houston, TX · Member since 2021 · 54 posts · 35 votes
3y
@Brooklyn Taylor Hey Brooklyn, I'm right outside Houston in Cypress/Magnolia area so hello neighbor! I'm also a REI bookkeeper and can help with this. :) Do they have a certain template they want you to follow or just a normal P&L breakout be fine? Do you currently use QBO or how do you keep up with all your transactions?
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Jay ThomasPro Member
Real Estate Agent · Houston, TX · Member since 2021 · 1k+ posts · 715 votes
3y
Sure thing! Creating a Profit and Loss (P&L) statement for your HELOC application is a smart move. While there's no one-size-fits-all template, here's a basic outline to kickstart your process:

For Income, list your rental income per property, any additional rental-related income (like laundry or storage), and any other income sources.

Under Expenses, include mortgage payments for each property, property taxes, insurance costs per property, property management fees, funds for repairs and maintenance, utilities (if you're covering them), HOA fees, advertising and marketing expenses (if you're looking for new tenants), legal and professional fees (like accounting), property depreciation (if applicable), and any other expenses (cleaning, landscaping, etc.).

Then, crunch the numbers to calculate your net income or loss for each property and the overall total
[email protected]832-889-5607
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Alex Hunt
Lender · Member since 2022 · 441 posts · 134 votes
3y
Quote from @Ali Nichols:

Following this because I've had a hard time finding anyone who will HELOC on an investment property.

We do 2nd position/ lien, 30year fixed for rental properties. Minimum $50,000 - maximum $500,000
@Brooklyn Taylor your banker is likely asking this for DTI or cash flow, I understand conventional banks are better on rates but have you looking into DSCR or hard money lenders for rentals or fix n flips?
Would be happy to go over any deals with you.
P&L consist of tax, insurance, principal and interest payments, utilities if you pay, HOA or management/ maintenance, versus your rent and any other income( storage, garage, laundry)

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