Asking on behalf of a friend. He owns a duplex, free and clear, with a partner in Connecticut. Property is held in both of their names, not an LLC. Partner wants to exit. I'm still waiting on all the numbers, but the appraised value is ~$460k and it cashflows (sorry, will post more as soon as I get it). Partner's share is $320k. They have an untapped $200k HELOC @2% through the local credit union. Friend has good credit, but is self-employed, so reported taxable income is low.

How would you structure this buyout deal and which lenders would you try first? My thoughts:

1.  First, try to secure cash-out refinancing either through the credit union or a conventional bank.

2. Try to structure a deal with partner, using the existing HELOC + a note for the balance payable to partner. This is less than ideal because the partner is still in the picture, but may offer the best terms.

3. If that doesn't work, reach out to commercial lenders. But which ones?

My friend's goal is to hold onto this property, but he is willing to consider selling if financing cannot be secured.

Any advice is greatly appreciated!