Has anyone used HELOC as a down payment for investment property?

[Thomas W.]

I am looking to use the HELOC to take the equity from my primary residence and use it as a down payment for an investment property. I am not in a position to use the investment property as my primary residence to house hack so I realize that the interest rates will be less favorable.

Has anyone made a deal work using a HELOC as a down payment for a buy and hold property?

How difficult was it?

[AJ Wong]

HI Thomas. I have a property in contract that the downpayment (10% of $695k) was sourced from a HELOC on the buyer's primary. This is almost aways permissible as a source of down payment funds. Many HELOC or second mortgages are fixed interest rates and depending on the loan amount, even offer 100% online and no appraisal requirement for issuance. Surprisingly easy and also available for investment properties.

Reach out to @Joseph Chiofalo for help with structuring and simultaneous closings. They have some low down payment 1-4 unit investor programs that can reduce the cash needed (equity line amount) to close. Also a seller concession is a good tool to reduce closing costs and carrying more than necessary on the primary. 

Good luck!