First Lien HELOC Strategy
What does the BP community think about 1st lien HELOCs as a way to free up equity in your primary home for investment purposes? If anyone has gone through the process, can you give any advice as to whether you recommend the strategy or if it is not worth it?
HELOCs usually have a 10 year draw period interest only before amortizing out.
- If you have a 1st lien HELOC, what happens to escrow for taxes and insurance, can it be waived and paid out of your own pocket or is it tied up into the monthly payment?
- With regards to recourse vs. non-recourse loans, would putting the HELOC in 1st position allow a bank to come after personal assets in the event of a default?
- Are there any banks/credit unions that charge LIBOR instead of Prime on HELOCs?