HELOC on an investment loan

5 Replies

Hi all. I bought an investment property and would like to move into it as my primary residence. To release the capital I have tied up in it, can I get a HELOC loan, or is there another option that is less expensive than a full refinance (large fees)? I've had the property 2 years. Thanks!

You can get a HELOC on it whether it's an investment property or your primary residence, but if you're going to move into it and make it your primary residence I'd wait to get the HELOC until you do that because your options will be MUCH better at that point in terms of interest rate, LTV, and the number of banks/lenders that are willing to do it.

HELOCs are great because they're typically zero cost to a few hundred bucks (for an appraisal) to setup, and - once it's setup - it's always available when needed but you only pay interest when you actually use it.

Here's some questions you can ask when calling around to different lenders: What You Need to Know When Shopping for a HELOC.

Good luck. 

Thanks for the response Kyle. The current lender doesn't offer HELOC and my mortgage advisor told me no one will do it on an investment loan or if I am not living there as my primary residence. A HELOC would be fantastic if I can get it arranged.

Any finance people out there run across this? Or can recommend any lenders they've worked with that have good products? I live in the Florida Panhandle if that helps.

Thanks, K

@Kelvin J. , you can get a HELOC on an investment property, but as pointed out, the terms are significantly less favorable. I would say a CLTV of 80% tops and more likely around 70%. Owner occupied HELOCs can be had for 100% CLTV. Shop around. Your current lender isn't the only game in town and your mortgage adviser is misinformed.

If you are moving into the property and it will be your residence, it should not be a problem to get a HELOC. Try First Florida Credit Union out of Jacksonville. I'm not sure if you are in a county they service, but I recently got a HELOC from them for 90% LTV. They paid all closing costs and gave me a great rate. I shopped about a dozen lenders before I found them.