What would you do to leverage these properties to get others?

Question

Looking for some advice! I’ve got one long term rental that I got a family loan to purchase. I owe around 60k to my dad with a very low interest rate, and it’s valued around 150k. I’ve also got a short term rental with about 78k financed and it’s valued around 250k. What would you do with these properties in order to leverage them to get other properties?

Lisa Lister · Answer

I am a local Realtor in Branson and we own STRs and LTRs in town, as well as some new emerging markets locally. We did a HELOC for our STRs initially and then bundled them together with our lender to do a larger HELOC to fund some fix and flips and also LTRs. My only advice is to use a local lender who knows our market here. All the best!!

Chris Seveney · Answer

you can try a HELOC, if that does not work you could blanket/portfolio them and and maybe get around $125k - $150k between the two as a lender will go 70-75%. If you go private lender expect to pay low to mid teens for an interest rate.

Andrew Postell · Answer

@Cameron Paschke I'm guessing that the $78k is financed at a pretty good rate too?  Just get a HELOC on each property and call it a day.  No need to "refinance" into today's interest rates if you have good rates on the underlying loans.

Charlie Hardage · Answer

You have a few options:

HELOCs

Home Equity Loan

Cash-out refinance

Is the rental in your dad's name and he is doing seller financing? Or did he lend you the money?

If it's in your dad's name he would need to do the HELOC, HE loan, or refinance. If it's owned outright and you are just sending him money every month, you may be able to take out a HELOC for 80% of the $150k since a lender may not know there's a loan on it.

For the STR, it's possible to get a HELOC but you would have to call around. It would be more likely you would need to refinance or get a 2nd mortgage.