Best use of home equity

[Scott Settimo]

We own our primary residence free and clear; I’m wondering how best to unlock that equity to acquire cash flowing commercial RE - take out a home equity loan or in some other way use the equity as collateral. Thanks for any suggestions.

[Shaun Weekes]

Originally posted by @Scott Settimo:

We own our primary residence free and clear; I’m wondering how best to unlock that equity to acquire cash flowing commercial RE - take out a home equity loan or in some other way use the equity as collateral. Thanks for any suggestions.

Your 2 best options will be to either obtain a HELOC or do a cash out refinance. Both methods are used often, and I personally prefer a cash out refinance. The main reason is because I have the cash readily available. The rates will be better, but you have to pay on that money right away. On a HELOC you only pay on what you use but the rates are going to be higher.

Just make sure that you have a defined plan.

I hope this helps and have a good one Sir.