Equity stripping question for someone in Seattle area?

Question

Hello all,

I wondered if anyone could assist me with a resource for this conundrum :)

I own a cash flow positive SFH rental in Seattle that I'm trying to pull equity from for more investing (flipping) outside the state.  I also now live outside the state (in Tennessee).

The issue is that I currently am not earning W2 income to pursue a typical HELOC from it.  Also, I attempted to reopen a line I used to have on it years ago, but the credit union I worked with no longer allows this for out of state residents anyway.  I'm pretty leveraged otherwise, with both one additional rental and a primary home here -- both mortgaged and with a HELOC.

Any creative strategies?  Current value of property is around $500K, only loan on it is a primary with $199K balance.

Thanks for any advice!

Charlotte Bishop

Charlotte Bishop · Answer

Thanks to everyone for your input!

Thomas Mattausch · Answer

If you have rental income on your tax returns, that should be usable.

Try Jackie Shuey at Movement Mortgage.

Thomas S. · Answer

Is the property worth keeping. If the rent is not close to 5K/month it really is not a good investment as a rental property. Better to sell now while markets are strong and move on to bigger and better things.

Nghi Le · Answer

@Charlotte Bishop

It's going to be hard without a W2.  I've only known HELOCs to come from banks, and usually, they underwrite it in a similar way to conventional loans, which cares about your income, DTI, etc.  But lending is getting looser and looser each year, so things may have changed.

You can get a non-conventional, asset-based refinance loan on it, but usually those come at a higher rate (5-8%).  But the problem is that you're in Seattle, which is hard to cash flow even at low bank rates.