Using HELOC for max benefit.

[Jon Panuska]

I am looking for the most effective way to use a HELOC and or cash to finance rental properties. I currently am not buying as the market in our area seems overpriced. (Usual for August and September )

I have a HELOC for $300,000. The bank had me transfer the current mortgage to the HELOC which is $119,000. I am good with the transfer as the rate is lower and no closing etc.

I currently have the cash to pay off the HELOC and avoid all interest, but that does not leave much available cash left.

My plan is to purchase a few properties in November or December. I will end up at 25 to 30k down per property.

So is it a good idea to keep the cash for downpayments, or pay the HELOC off now and use the HELOC when I am ready to purchase?

As a side note, I am self employed with a business that makes 80 to 90k a year and I have a few rentals which each cashflow about $550 per month all currently under lease.