HELOC under LLC or Personal

[Kristel Vite]

Hi, this is my first post - I'm looking for some guidance.

I started investing in real estate 4 years ago, I currently own 4 rental properties - all cash flow ~$550+ per unit per month. My CoC return is 15%-20% on each and I feel I'm in a good position to keep growing.

I don't want to use my cash as I'm saving it for a personal purchase. I want to start tapping into my equity in one of my properties that I purchased in 2021, my current rate it 4.5% and I'm not looking to refi cash out.

Based on my research, HELOC is my best option. My 75% LTV will get me 40-50K out which is all I need. I got a lender approved me for that amount with a variable 8.5% rate for 30 years under my personal name.

Is this the best route? Are there any lenders that will lend under my LLC, so I don't keep adding accounts under my name? I found a lender that will help me buy my next property (DSCR Loan) under an LLC.

Thank you!

[Erik Estrada]

Quote from @Kristel Vite:

Hi, this is my first post - I'm looking for some guidance.

I started investing in real estate 4 years ago, I currently own 4 rental properties - all cash flow ~$550+ per unit per month. My CoC return is 15%-20% on each and I feel I'm in a good position to keep growing.

I don't want to use my cash as I'm saving it for a personal purchase. I want to start tapping into my equity in one of my properties that I purchased in 2021, my current rate it 4.5% and I'm not looking to refi cash out.

Based on my research, HELOC is my best option. My 75% LTV will get me 40-50K out which is all I need. I got a lender approved me for that amount with a variable 8.5% rate for 30 years under my personal name.

Is this the best route? Are there any lenders that will lend under my LLC, so I don't keep adding accounts under my name? I found a lender that will help me buy my next property (DSCR Loan) under an LLC.

Thank you!

 Hi Kristel, 

There are DSCR lenders that provide fixed second-position loans, and you can close the deal in an LLC. However, since you're signing a personal guarantee on a DSCR loan, even though it's not reported on your personal credit, you should still disclose the debt. Most conventional underwriters will condition for the mortgage note and payment history if they see rental income reported on your personal tax returns.