Refinance on a small building

[Khanh Tran]

Hi,

I bought a small building (1200 sqft) for cash one year ago. I have leased this building to a commercial tenant, and i would like to refinance or HELOC for this building. This building is worth around 150K. I would like to know what are my best options:

1) Since this building is used for investment, so can i still do HELOC on this building?

2) Can i apply a residential loan for this building since it is small likes a home? Or do i have to apply a commercial loan since this building is zoning to commercial and used as commercial?

Thanks,

[Andrew Postell]

@Khanh Tran to find lenders in Texas that lend Lines of Credit on investment properties is super difficult.  I've probably spoken with about 200 lender in the Dallas area...and I have 2 up here.  If you are ok with getting a 30 year fixed rate cash out loan, then your options open up some.  But a line of credit is really hard to find.

The things I would recommend:

1. Calling really small banks.  Like, REALLY small.  if you have never heard of it...and it has one location...then that's a good bank to call!  They still may not have the product but large banks are completely out for this product.  The smaller the better.
2. When you are talking with banks use the term "line of credit"....I know, I know...it sounds like I'm splitting hairs here but a HELOC will usually direct you to the residential division and the Line of Credit will take you to the commercial division (I discovered this over time asking about this subject). So just ask about Lines of Credit and see if they say yes.

I hope those tips help.  Good luck!