HELOC to start house hack

4 Replies

Hello all!

So me and my wife own a home and we were thinking about renting it out and house hacking a multi family property here in Southern California. Our goal is to create income through multi family rentals. We wanted to know if anyone has done that recently and what is some advice that you can give for us first timers? Also, what's the best way to pull out cash... doing a HELOC or a cash out refi to get started? We owe about 225k on our current home and it's worth about 375k so we can pull out some cash to house hack. thanks I'm advance!

I have never done it but it is fairly common for some to get started house hacking a smaller multi family property.  Use the search feature and you will likely find plenty of info.

@Raymond Kovats , either way, my question is: will renting it out cover all its ongoing costs (including the HELOC/Refi loan)?

Also, how much extra do you have squirreled away for deposit/rehab costs? Good luck...

@Brent Coombs thanks for the info. while renting my house out it should pay the mortgage and the HELOC that I would do. Also, I have about 25k for repairs etc put away.

Originally posted by @Raymond Kovats :

@Brent Coombs thanks for the info. while renting my house out it should pay the mortgage and the HELOC that I would do. Also, I have about 25k for repairs etc put away.

I suppose the real question then is: Will your cash-out provide enough deposit to get into Multi-Family investing (in the $600k+? range)? With low deposit FHA owner-occupier loans, my guess is: yes, providing your DTI is acceptable to your Lender. Once a percentage rent from all your rental units are taken into account, that should make it easier. Way to go! All the best...

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