HELOC Questions BRRR Strategy

8 Replies

Hey Everyone! 

Just want to be right upfront and say I have 0 experience with HELOC. But here are my questions and if you have anything to add please let me know! Every bit of information is appreciated

If I have a PML fund a fixer upper (Purchase and Repair) Single Family Rental am I able to pull the money back out via a HELOC if the house appraises out for the right value to pay the PML back?

Let me know the PROs and CONs of this strategy or any experience you have had with it! 

Very few banks or lenders will give a HELOC for investment properties. They usually issue for primary homes used for residence.

Search for "HELOC" on the top RHS, and you should find a lot of blogs and articles about this. And BRRRR strategies.

@Chris T. I can do helocs on investment properties at 75% ltv and 90% for primary. You would have to be in my footprint unfortunately. IL, IN, IA. I'm sure you'll find a local bank that can do it. I would def get a heloc to pay them off.

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Originally posted by @Carter Crowley :

@Joe Villeneuve The house would be completely paid off upfront, so they only REFI I think I would be able to do is a Cash-Out Refi if I'm not mistaken? Have you had experience with this?

 To do a cash out refi you would need to season the property 6 months.  If you have 100% equity (paid off property), you have to wait 6 months.  Usually you can do a Rate and Term right away though, to refi any existing loans on the property.