Hi, I have an investment property with about 50% equity in it. I am interested in leveraging the equity to do some more real estate investing. I have approached a few banks (including the current mortgage holder) and a few credit unions about obtaining a HELOC on this property. I have been repeatedly told things like: 1) we don't do HELOCs if we are in second lien position behind the primary mortgage holder 2) we only do HOLs, 3) Etc. I have checked with the primary mortgage holder and they do not offer HELOCs. Does anyone know of any lenders that will do a HELOC in this situation? Or does anyone have any other ideas on how to leverage this equity? Note: I'm not much interested in the home equity loan type of offer as I'm not sure when I would pull the trigger on a another real estate transaction (real estate is the side job). Thanks in advance.

FYI, I contacted all of the companies in the posts above asking if they have a HELOC product offering for single home investment property in Ohio when they are not the first mortgage holder. Navy Federal Credit Union has a product. Pentagon Federal Credit Union (PefFed) has a product. Thanks for the help!

I for one appreciate when people get back on here and update us on their results.... thanks Mike! I was curious about the same product

Just to update anyone who may be looking for info on the subject, I've called around to a number of banks and lenders and this is what my list looks like: Ridge Lending Group-YES. Max 70% LTV, minimum initial draw of $75k, but they have no rule saying you can't pay it back immediately and then just keep the line open. You do pay 2.5 points on that 75k though, so its about $1850 in initial costs. Rate as of 24Feb was 5.5%, the lowest I found. NavyFed-YES (for members). 70% LTV and requires 6-month seasoning (to use an 80% value of your home) or 12-months (to use 100% of the appraised value). Wells Fargo-YES. Only 60% LTV. Also requires 12 months of seasoning. Union Bank-YES. 65% LTV and limited to a few states in the Pacific NW. TD Bank-YES. 75% LTV. Prime+1.74% interest. Total fees approx. $1580, no seasoning required. PenFed-YES. 80% LTV. Still waiting on some more details from them. US Bank-NO. Called multiple people and departments. Always the same answer. TrustCo-NO. SEFCU-YES. 70% LTV. 5.75%-7.75% interest.

@Mike Smith are you saying that you want a HELOC on your investment property?...Not your residence... I use Middlefield Bank out of Dublin. 85%LTV, 3.25%APR, they eat all the costs...zero out of pocket...10 yr term with interest only payments...let me know if you need a contact name.

Yes @Mike H. , it seems like a dream since we've found nothing even close to it since then! I believe it was a 70% LTV, maybe 75%, but I'd have to pull the paperwork to be sure. There's a $50 a year annual maintenance fee on each one, and we saved half a percentage point by doing direct debit on each as well. We had 2 other mortgages with 2 other banks, yes. An investment property can also be considered a "vacation" home, and if you're married, you and your spouse can each have one.

Ridge Lending has 1st lien HELOC, an All in One HELOC, at 70-75% LTV on an investment property, 30 year loan, no principal due for 10 years. https://www.ridgelendinggroup....

There are probably 100s or 1000s of banks and credit unions you could try. Here are some more you can try: -CBC National Bank -Emery Federal -Freedom Mortgage -Fulton Mortgage -PNC -USAA -Navy Federal -Langley Federal If you don't have the necessary reserves, you could try a commercial loan or line of credit

Mike is totally right...a very long time ago I worked for HNB and they're very HELOC friendly. They will absolutely have a higher APR than you'll see on your primary home, but I think that's probably fairly typical in the HELOC world with rentals. The only problem I think you'll see with HNB is that they will be a little more difficult to work with if you aren't inside of their footprint (OH, IN, PA, WV, KY, and MI). However, I will say that while skimming this thread I also saw mention of Navy Federal Credit Union. They offer investment mortgages, I would be they also offer HELOCs, however I've not done any looking. HNB's HELOC can be variable or fixed, but the variable is typically a much better rate, and I would certainly make sure you have good credit, they're pretty strict on their credit requirements.

HELOC on Investment Property?

Joe M.

Erie, PA · Member since 2018 · 413 posts · 348 votes

6y

Just to piggyback and not start a new thread-are banks more likely to offer a HELOC if the house is paid off?

HELOC on Investment Property?

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