Duplex Owned Free and Clear How to leverage for cash

Realtor · Atlanta, GA · Member since 2018 · 103 posts · 28 votes

Hi,

I own a duplex free and clear that is worth about 300k. I want to explore options of how to leverage the duplex to get home equity lines of credit or similar revolving lines of credit. Do you all have any options for me? I don't want a set amount of cash out.

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Dennis M.

Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes

Commercial cash out refi

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Tyler GibsonBusiness Member
Real Estate Agent · Orlando, FL · Member since 2017 · 1k+ posts · 2k+ votes
7y
@Justin Lee it sounds like you might want to get a HELOC(Home Equity Line Of Credit). The only issue you might face is if the property is deeded to an LLC. If it is deeded to your name you should be bale to go to your bank or any bank and get a HELOC.
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Justin Lee
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Realtor · Atlanta, GA · Member since 2018 · 103 posts · 28 votes
7y

@Tyler Gibson It is not held by an LLC. However, I tried to do a heloc with Regions and Navy fed and was denied as its an investment property and duplex. Do you know of any lenders who do these types of loans?

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Dennis M.
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
Commercial cash out refi
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Tyler GibsonBusiness Member
Real Estate Agent · Orlando, FL · Member since 2017 · 1k+ posts · 2k+ votes
7y
Originally posted by @Justin Lee:

@Tyler Gibson It is not held by an LLC. However, I tried to do a heloc with Regions and Navy fed and was denied as its an investment property and duplex. Do you know of any lenders who do these types of loans?

I would ask every bank I drive past. See if a local bank would be interested. If not at the end of the day you could always take out a MTG on the property. I know that isn't revolving credit but it is cash in hand and a tax write off for the interest.
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Justin Lee
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Realtor · Atlanta, GA · Member since 2018 · 103 posts · 28 votes
7y
@Tyler Gibson goodpoint. Thanks! I will look into that !
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Daniel DietzPro Member
Rental Property Investor · Reedsburg, WI · Member since 2011 · 1k+ posts · 857 votes
7y
I just set up a HELOC on a set of three duplexes we own yesterday! It was easy as can be because we did it through a local bank that holds the first mortgage too. This is a smaller local bank that understands rentals
Terms were 5.5% interest only on what we have drawn out. We were able to do it with no appraisal as we had them from our purchase less than 3 years ago. They did up to 80% of appraised value as we only borrowed about 70% when we bought them.
[email protected]608-524-4899
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Tim DelaneyPro Member
Buffalo, NY · Member since 2018 · 790 posts · 530 votes
7y
From what I have been told it is tough to get a HELOC on an investment property. Your best bet would be a refinance - you may be able to do this through a conventional mortgage. If you own other properties with equity you may be able to get a commercial line of credit on the portfolio.
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Emily Lee
Specialist · Austin, TX · Member since 2014 · 1 post · 0 votes
7y
@Justin Lee I am a mortgage LO and have worked for many of the big banks....very few will do investment property HELOC but you should be able to pull cash out up to 75% of the property value with a Conventional mortgage (assuming all other qualifying criteria is met of course).
If qualifying Conventional is an issue, there are also non QM programs that will do reduced/alternative documentation if needed. Those programs focus more on the cash flow of the property itself. Talk to a lender that has experience working with investors and has access to Conventional and non QM programs or PM me if you would like more info from me.
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Justin Lee
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Realtor · Atlanta, GA · Member since 2018 · 103 posts · 28 votes
7y
@Daniel Dietz I don’t have a mortgage on the property, but I will look into local banks. Do you know if you bank service Louisiana?
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Justin Lee
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Realtor · Atlanta, GA · Member since 2018 · 103 posts · 28 votes
7y
@Emily Lee thanks Emily. I will do more research on that as well. I really would prefer the heloc as it gives me a revolving line to better leverage for investing purposes.
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Daniel DietzPro Member
Rental Property Investor · Reedsburg, WI · Member since 2011 · 1k+ posts · 857 votes
7y
@Justin Lee they do not, just Wisconsin. It took a while to find them, but it seems like a lot of what I read on here is 'the smaller and more local the better'.... one that works with you and your situation instead of just some formula from the bosses off in some far away land :-)

[email protected]608-524-4899
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Tami DuBose
Lender · Prairieville, LA · Member since 2014 · 146 posts · 114 votes
7y
What @Tyler Gibson said - go local. Call them all. Someone wants to give you money when you have collateral.
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Ola Dantis
Multifamily Syndicator · Houston, TX · Member since 2016 · 1k+ posts · 2k+ votes
7y
@Justin Lee There are a couple of ways to do this:
You can get a Commercial Line of Credit
You can also look into a Business Line of Credit (if it is in an LLC)
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