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Updated about 8 years ago on . Most recent reply

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59
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134
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Molly Morlino
  • Johnson City, TX
134
Votes |
59
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Is a HELOC the right choice?

Molly Morlino
  • Johnson City, TX
Posted

Please forgive me... my husband and I are pretty new to this business. We're currently building two rental homes in Kyle, TX and will be building four more within the next 18 - 24 months.

We're thinking of opening up a HELOC in order to build the remaining four rental homes. They're small homes, and cost about $30,000 each to build, so we would need to borrow about $120k. We purchased our home in 2013 for $260k and currently owe about $230k on it. The market has exploded here and comps are in the $350s right now - our home could easily reach $375k.

Our mortgage is our only debt, we both have 800+ credit scores, my husband is a Professional Enginer and I work part time... With all of our extra income plus the rental income on 6 houses we would be able to pay the HELOC back within 12-18 months. Would this be a good option for us? Or is it too much money/too risky?

Thanks so much for any insight! I love reading and absorbing everything at Bigger Pockets!

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