Using Rental Property Equity to Grow My Portfolio — Need Advice

Fairfax, Virginia
Creative Real Estate Financing
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Using Rental Property Equity to Grow My Portfolio — Need Advice

Mustafa Mahmoodzada
Member since 2025 · 34 posts · 14 votes

Hello BP Community,

I own a primary residence and a rental property in Woodbridge, VA. I currently have about $450,000 in equity in the rental property. I’d like to leverage that equity to purchase additional properties and grow my real estate portfolio.

I’m particularly interested in the BRRRR strategy and eventually investing in new construction. I’ve reached out to two credit unions and the lender for my primary residence about getting a HELOC on the rental property, but they don’t offer HELOCs on investment properties.

I’m reaching out to this professional BP community for financial advice:

What are some financing options available to me to tap into the equity in my rental property?

Thank you in advance!

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Patrick Roberts
Lender · Charleston, SC · Member since 2019 · 1k+ posts · 1k+ votes
1y

There are a few lenders offering DSCR 2nd liens right now. Theyre expensive, but it may make more sense than a cashout refi of the existing 1st lien if it has a low rate and large balance. It will all come down to the math on the specifics of the rates, balances, and paydown timeframe.

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  • Upen PatelPro Member
    Lender · Nationwide Lender · Member since 2015 · 1k+ posts · 814 votes
    1y

    @Mustafa Mahmoodzada There are loan programs that will allow you to access the equity in your rental and keep your current low rate 1st in place.

    [email protected]571-200-6180
    1Reply
  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 968 votes
    1y

    @Mustafa Mahmoodzada

    Hey Mustafa — sounds like you're in a great position to scale! Tapping into $450K in equity can definitely help you grow your portfolio quickly, especially with the BRRRR strategy.

    If traditional lenders aren't offering HELOCs on investment properties, you might want to look into DSCR loans or portfolio cash-out refinance options. Some private lenders also offer investor HELOCs, though terms can vary.

    I invest mainly in Ohio — cities like Columbus, Dayton, and Cleveland — where that kind of capital can stretch pretty far and still cash flow well. Happy to share what kinds of deals I've seen work for others using similar strategies if you're exploring markets outside VA.

    Best of luck on your next steps!

    [email protected]614-418-6081
    1Reply
    • Mustafa Mahmoodzada
      OP
      Member since 2025 · 34 posts · 14 votes
      1y
      Quote from @Arman Ahmed:

      @Mustafa Mahmoodzada

      Hey Mustafa — sounds like you're in a great position to scale! Tapping into $450K in equity can definitely help you grow your portfolio quickly, especially with the BRRRR strategy.

      If traditional lenders aren't offering HELOCs on investment properties, you might want to look into DSCR loans or portfolio cash-out refinance options. Some private lenders also offer investor HELOCs, though terms can vary.

      I invest mainly in Ohio — cities like Columbus, Dayton, and Cleveland — where that kind of capital can stretch pretty far and still cash flow well. Happy to share what kinds of deals I've seen work for others using similar strategies if you're exploring markets outside VA.

      Best of luck on your next steps!

      Hi Arman, 

      Thank you for your reply. For now, I’m focusing on deals within a 2-hour drive from my home. However, home prices are high in Northern Virginia (NOVA). I’m open to out-of-state investments if I can’t find good cash-flowing deals in my area. I’ll reach out to you to explore what opportunities are available over there. Are you a Realtor in Ohio?

      0Reply
  • LaMancha Sims
    Lender · Fayetteville, GA · Member since 2019 · 241 posts · 41 votes
    1y

    @Mustafa Mahmoodzada I Would Love To Connect With You To Discuss Other Options For Your Deal...I'm Sending You A PM.

    0Reply
  • Patrick Roberts
    Lender · Charleston, SC · Member since 2019 · 1k+ posts · 1k+ votes
    1y

    There are a few lenders offering DSCR 2nd liens right now. Theyre expensive, but it may make more sense than a cashout refi of the existing 1st lien if it has a low rate and large balance. It will all come down to the math on the specifics of the rates, balances, and paydown timeframe.

    1Reply
  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 2k+ posts · 3k+ votes
    1y

    @Mustafa Mahmoodzada check out Figure.  They offer up to $450K HELOCs in 2nd position and up to $750K on HELOCs in 1st position on investment properties.  They also have HEloan options.  I've used them many times successfully!

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5335 Reviews
    WebsiteView Page
    1Reply
    • Mustafa Mahmoodzada
      OP
      Member since 2025 · 34 posts · 14 votes
      1y
      Quote from @Zach Lemaster:

      @Mustafa Mahmoodzada check out Figure.  They offer up to $450K HELOCs in 2nd position and up to $750K on HELOCs in 1st position on investment properties.  They also have HEloan options.  I've used them many times successfully!

      @Zach Lemaster Thank you. I will get in touch with them. 

      1Reply
  • Doug SmithPro Member
    Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
    1y

    I was a banker in my previous life. Now I own a mortgage company that does a lot of investor lending. Federal Bank and Credit Union Regulators despise real estate investors, so unless you've got a significant deposit relationship with them, they don't like to do investment property lending. You can, however, do a cash-out first mortgage, an Equity Line, or an Equity Loan in 2nd lien position on an investment property. The Loan-to-Value will be lower than if you were borrowing on your primary, but it's done all the time. Just don't go to the bank or credit union. You need to use a lender that has a strong history of lending to investors. 

    0Reply
  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 2k+ posts · 3k+ votes
    1y

    @Mustafa Mahmoodzada happy to help!  ; )

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5335 Reviews
    WebsiteView Page
    0Reply
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