What has been you r experiance with these and do you like using them. Example you put $10000 in a 5 year cd. Bank allows you to borrow against that money 2 points over what the cd is getting. My thought use for down payments etc? Then rinse an repeat.
bank is so generous. Letting you borrow against your own money and chasing you 2 point spread. Really don't see any upside. Better get a preferred stock or some other form of liquid high yielding asset.
My bank tries to get me to do that and for the life of me I can't figure out any reason for doing so (and I like to think I'm somewhat smart)
They want me to take out a line of credit, secured by money in my bank account, at 2% over what they pay me.
So if I can jump in with the OP and ask why I'd ever want to do maybe I'd learn something that my banker hasn't been able to explain.
(There was one legit reason to do so that has to do with how silly banks can be with cash out refinancing but that's more of a work around to lame regulator rules)
Think ya'll bring up very valid points I think the idea just appealed to some psychological thing in my head that the money was still there, the interest is tax deferred etc. but since it's locked in a way it's still not there. My idea was to keep it at 10-15K all cash flow from different properties would go to paying off line and then when line is payed off go buy another property.