HELOC on a rental property?

Question

Hey guys, I've got a few questions about HELOCS on rental properties.

1) Does anyone have experience with local credit unions in the DFW or Sherman/Denison areas of North Texas that will do HELOCS on rental properties for which they do not hold the first lien? If so, how was your experience with them, and whats the max LTV they'll do?

2) I have all my properties in my own name currently, and I want to transfer them into my LLC soon, so my question is this: Is there any issue that lenders have lending on rental properties owned in an LLC vs in my own name? Basically, should I wait?

Thanks,

-Chandler

Mike Freeman · Answer

Good Luck

Mike Freeman · Answer

There are a lot of possible issues you really need to consider and explore if you want to proceed with both of your  proposals.  I am not an expert in this area, but I presume by your description on your properties that they are currently mortgaged.  Be sure your current mortgage holder is ok with the transfer to LLC.  I'm sure your mortgage has a due on sale stipulation, and they may consider the transfer to the LLC as a trigger for this stipulation in the mortgage.  Many other things to consider, deed changes, property tax association changes, property insurance changes, amount of HELOC available verses equity, etc.   I'm sure you will receive a lot of advice from others more knowledgeable than me.  Lood luck.