Hoping to get advice on using HELOC for a down payment on a house.
My parents are planning to put their Lake Stevens, WA house under my name which would allow me to use its equity in the form of a HELOC. As of now, the house has 200k in equity (valued at 400k with 200k left in mortgage).
By having the Lake Stevens house under my name, I would be able to use the HELOC for a down payment to purchase my first property (excluding the Lake Stevens house). Are there any major factors I should consider before looking further into this strategy? Is this strategy viable for a new investor? Any advice would be greatly appreciated. Thank you!
@Keith Acfalle Great strategy overall, lots of people do this.
Things to keep in mind, taking a HELOC would put your parents house (if they live there) at risk if you can't make the payments. Also get your credit score as high as possible for the best rates (kind of goes without saying, but lots of people think just because there's equity, doesn't mean it can be accessed if you have a 600 score).