HELOC on investment property

Creative Real Estate Financing
5yFollow

HELOC on investment property

Chris Kimsey
Rental Property Investor · Brenham, TX · Member since 2019 · 28 posts · 6 votes

Has any one had any experience with doing HELOCS on rental properties? How hard is it to find lenders for it? Is the process more stringent?

I am an investor here in Texas. Rental property is currently leased out. The appraised value is 185k and current loan is 127k

Would like to hear your experiences.

Thanks.

1Reply
116 views

Most Popular Reply

Kerry BairdPro Member
Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
5y

I posted this elsewhere today, and was able to add two lenders to the list.  If one works for you, please let me know. 

Try local community bank or credit union for investment properties. TD and US Bank are my best recommendations.

I've gleaned these lenders from the kind people on BP. I have used PenFed and TD Bank for HELOCs on investment property. Post back if you find another lender who serves you well, and I will add them to my list and pay it forward. These were largely sourced pre-CV19, so eat the fish and spit out the bones.

The DTI percentage range varies by lender, and is less than what you will find for an owner occupied property, due to lender risk. While qualifying for a HELOC is dependent on your home equity and your credit score, good or excellent credit makes it easier to qualify. A good average to shoot for is 620 or higher. Plus, the better your credit score, the better your interest rate.


Ridge Lending All in One, first position HELOC

AFCU does 80% LTV on NOO. Utah

Americafirst 80% LTV on noo 65% LTV Utah

Arvest Bank AR, OK, AL, MO

Bank of West (BNP Paribas) 60% LTV ELOCs

BB&T will loan on a rental portfolio

BBVA Compass

Bellwether NH and MA 85% to 100%, draw 10 yrs

Boeing employee credit union

California: Cal Coast Credit Union and Fremont Bank

Citizens Bank -Minnesota, only in-state. Kyle Potswald

Citizens first position HELOC

CMG a financial 70% LTV

Consolidated CCU, high LTV NOO LOC, OR, WA

East West Bank, up to 60% LTV with "no docs”

Figure 80% on a rental, not in LLC

FirstBank CO a and AZ 75% LTV

First Florida Credit Union https://firstflorida.cumortgag...

First Commonwealth

First Midwest, up to 90% Chicago area

First Republic - California

Fulton Bank

GFA Federal Credit Union 10 yr draw, 10 yr repay, MA

Granite State CU, NH 90-100%

Great Lakes Credit Union

Hanscom FCU, Florida

HSBC 70%, for premier clients only

Horizon, Kalamazoo Michigan

Huntington 75% LTV 5 yr IO product available

Hurst Lending and Insurance Investment property HELOC in Texas. No seasoning.

Key Bank, FLorida flexible lender, HELOCs on second
homes and rental properties. 90% LTV on primary.

Mountain America Credit Union in Utah, Idaho, Montana, Nevada, Arizona, New Mexico. 85% LTV, promo rate of 1.99%. Can refinance an existing mortgage on investment property to a shorter term “Mini Mortgage.”

Merchants Bank MN See Pavel Ushakov

PenFed - max 3 other properties, 89% LTV

Quorum Federal Credit Union 80% equity, owned by LLC is OK. 5 year interest only payments. New York State. Tiffany Mazzoccoli. 2021

Regions- yes HELOC but no LOC

River Bank & Trust, AL

SCCU Florida 70% LTV, 6.25% interest only, not LLC

Signature Federal Credit Union 75% LTV

Sound CU "non-owner occupied HELOC, capped at $150K and interest rates are prime + 2%, 3% or 4%, based on credit, not to exceed 70% ltv.”

S&T Pennsylvania

TCF Bank

TD Bank 75% line with FICO about 740

TIAA Direct was EverBank

Troy Bank & Trust, AL

Trustco

Union Bank, specializes in noo HELOC. KCMO, NE

Union Bank, MUFG.

Upstate Bank in Rochester NY, LOC up to 80%

US Bank

Vectra Bank - Colo

Veritex, Texas HELOC

Workers Credit Union, MA 80-100%

WSFS...up to 70% on rental

14Reply
See this reply in the discussion

20 Replies

Jump to latestLatest
  • Malcomb StapelPro Member
    Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
    5y

    Yes, we have one on our first rental property. Our lender (local bank) will do up to 80% LTV on investment property HELOC's. We actually used it as part of our down payment on our latest acquisition.

    In our case, it is yearly renewal with a reappraisal every five years. That means each year when you do the renewal you get the additional amount that you paid down the principal added to the amount that you can borrow. 

    2Reply
  • Chris Kimsey
    OP
    Rental Property Investor · Brenham, TX · Member since 2019 · 28 posts · 6 votes
    5y

    @Malcomb Stapel thanks. If you don't mind me asking which state do you invest in?

    0Reply
  • Kerry BairdPro Member
    Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
    5y

    I posted this elsewhere today, and was able to add two lenders to the list.  If one works for you, please let me know. 

    Try local community bank or credit union for investment properties. TD and US Bank are my best recommendations.

    I've gleaned these lenders from the kind people on BP. I have used PenFed and TD Bank for HELOCs on investment property. Post back if you find another lender who serves you well, and I will add them to my list and pay it forward. These were largely sourced pre-CV19, so eat the fish and spit out the bones.

    The DTI percentage range varies by lender, and is less than what you will find for an owner occupied property, due to lender risk. While qualifying for a HELOC is dependent on your home equity and your credit score, good or excellent credit makes it easier to qualify. A good average to shoot for is 620 or higher. Plus, the better your credit score, the better your interest rate.


    Ridge Lending All in One, first position HELOC

    AFCU does 80% LTV on NOO. Utah

    Americafirst 80% LTV on noo 65% LTV Utah

    Arvest Bank AR, OK, AL, MO

    Bank of West (BNP Paribas) 60% LTV ELOCs

    BB&T will loan on a rental portfolio

    BBVA Compass

    Bellwether NH and MA 85% to 100%, draw 10 yrs

    Boeing employee credit union

    California: Cal Coast Credit Union and Fremont Bank

    Citizens Bank -Minnesota, only in-state. Kyle Potswald

    Citizens first position HELOC

    CMG a financial 70% LTV

    Consolidated CCU, high LTV NOO LOC, OR, WA

    East West Bank, up to 60% LTV with "no docs”

    Figure 80% on a rental, not in LLC

    FirstBank CO a and AZ 75% LTV

    First Florida Credit Union https://firstflorida.cumortgag...

    First Commonwealth

    First Midwest, up to 90% Chicago area

    First Republic - California

    Fulton Bank

    GFA Federal Credit Union 10 yr draw, 10 yr repay, MA

    Granite State CU, NH 90-100%

    Great Lakes Credit Union

    Hanscom FCU, Florida

    HSBC 70%, for premier clients only

    Horizon, Kalamazoo Michigan

    Huntington 75% LTV 5 yr IO product available

    Hurst Lending and Insurance Investment property HELOC in Texas. No seasoning.

    Key Bank, FLorida flexible lender, HELOCs on second
    homes and rental properties. 90% LTV on primary.

    Mountain America Credit Union in Utah, Idaho, Montana, Nevada, Arizona, New Mexico. 85% LTV, promo rate of 1.99%. Can refinance an existing mortgage on investment property to a shorter term “Mini Mortgage.”

    Merchants Bank MN See Pavel Ushakov

    PenFed - max 3 other properties, 89% LTV

    Quorum Federal Credit Union 80% equity, owned by LLC is OK. 5 year interest only payments. New York State. Tiffany Mazzoccoli. 2021

    Regions- yes HELOC but no LOC

    River Bank & Trust, AL

    SCCU Florida 70% LTV, 6.25% interest only, not LLC

    Signature Federal Credit Union 75% LTV

    Sound CU "non-owner occupied HELOC, capped at $150K and interest rates are prime + 2%, 3% or 4%, based on credit, not to exceed 70% ltv.”

    S&T Pennsylvania

    TCF Bank

    TD Bank 75% line with FICO about 740

    TIAA Direct was EverBank

    Troy Bank & Trust, AL

    Trustco

    Union Bank, specializes in noo HELOC. KCMO, NE

    Union Bank, MUFG.

    Upstate Bank in Rochester NY, LOC up to 80%

    US Bank

    Vectra Bank - Colo

    Veritex, Texas HELOC

    Workers Credit Union, MA 80-100%

    WSFS...up to 70% on rental

    14Reply
  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Kerry Baird

    Thanks for sharing the detailed list! I've seen a lot of these names with local branches here in my market but haven't heard of their HELOC on investment property. I'll have to check!

    [email protected]614-363-2787
    Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews
    WebsiteView Page
    0Reply
  • Malcomb StapelPro Member
    Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
    5y

    @Chris Kimsey We currently live and invest in Kansas. 

    1Reply
  • Kerry BairdPro Member
    Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
    5y

    @Chris Kimsey, the homestead protections in Texas make it a much more challenging puzzle to figure out.  Small local lenders continue to be the best best.

    0Reply
  • Ben Zimmerman
    Rental Property Investor · Raleigh, NC · Member since 2016 · 396 posts · 995 votes
    5y

    I recently used PenFed to take out a HELOC on 2 different rental properties for a combined total of 188k @4.75% interest with a max of 75% LTV. It was a super clean and easy closing process and didn't need an appraisal or anything like that.

    2Reply
  • Jim Cummings
    Residential Real Estate Broker · College Station, TX · Member since 2013 · 1k+ posts · 969 votes
    5y

    @Chris Kimsey. Don't think you'll find any Texas Lenders that will do a HELOC on Investment Property as I think the Texas lending regulations prohibit them from doing so.

    Hopefully, a Texas Lender will chime in on this one. 

    0Reply
  • Chris Kimsey
    OP
    Rental Property Investor · Brenham, TX · Member since 2019 · 28 posts · 6 votes
    5y

    @Jim Cummings I was not aware of that. That's good to know. I hope to hear more about this as well.

    0Reply
  • Jessie Kristie
    Member since 2021 · 61 posts · 36 votes
    5y

    @Kerry Baird Thanks so much for sharing this. Currently doing my due diligence on HELOCs and this will come in handy when the time comes.

    1Reply
  • Audrey X.
    Rental Property Investor · Atlanta, GA · Member since 2018 · 41 posts · 29 votes
    5y

    @Chris Kimsey

    Doesn't HELOCs have a shorter repayment period like 20 year max? I know the rates are low right now but maybe a cash out refi is a better option.

    0Reply
  • Momi Rapozo
    Los Angeles, CA · Member since 2015 · 42 posts · 28 votes
    5y

    @Kerry Baird wow super helpful mahalo!

    1Reply
  • Chris Kimsey
    OP
    Rental Property Investor · Brenham, TX · Member since 2019 · 28 posts · 6 votes
    5y

    @Audrey X.

    If I pulled out the available equity the property would be an alligator. I am wanting to use the HELOC for a future brrrr deal. That way I can pay back the HELOC.

    0Reply
  • Ben Taub
    Newark NJ · Member since 2019 · 23 posts · 3 votes
    3y

    i see on the website of penFed ''Note: Only primary residences are eligible for a HELOC''

    0Reply
  • Matt Devincenzo
    Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
    3y

    @Ben Taub they dropped the investment property lending back around March of 2022. Hopefully it will come back as rates and values stabilize. With banks preparing loan loss reserves for a downturn the first business to get parred back is the riskiest e.g. investors sucking cash out of their investment properties with (possibly) inflated valuation estimates. 

    1Reply
  • Ben Taub
    Newark NJ · Member since 2019 · 23 posts · 3 votes
    3y
    Quote from @Matt Devincenzo:

    @Ben Taub they dropped the investment property lending back around March of 2022. Hopefully it will come back as rates and values stabilize. With banks preparing loan loss reserves for a downturn the first business to get parred back is the riskiest e.g. investors sucking cash out of their investment properties with (possibly) inflated valuation estimates. 


     makes a lot of sence Matt, also USBANK did the same looks like , as they wrote me a maasages ''We don’t currently offer HELOCs on investment properties, but we do offer cash-out refinance if you need to access the equity. Below are the options we have for accessing equity…''

    so i will try to start a new post asking for banks that currentlly still do HELOCs

    0Reply
  • Darway Dalmeida
    Member since 2022 · 29 posts · 6 votes
    3y

    These banks or CU do not do HELOC on investment properties as of 2023.

    I have called most or all of these on the list. Anyone have anything for 2022 or newer?

    0Reply
  • Kerry BairdPro Member
    Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
    3y

    @Darway Dalmeida, I was just on Navy Federal's site and they still have HELOCs for investment properties. My local community credit union does a first position HELOC, and I have called all of them local to me. Call around in the local area for small community banks and credit unions.

    1Reply
  • Darway Dalmeida
    Member since 2022 · 29 posts · 6 votes
    3y

    Thanks Kerry,

    I am having a difficult time refi 3 single rental, I owned and just don't feel like giving a hard money lender extra cash because I will be going right back to Fannie when rates dropped.  Let me called Navy Fed, I am a member.

    1Reply
  • Ben Taub
    Newark NJ · Member since 2019 · 23 posts · 3 votes
    3y

    i called TD Bank back in Nov 2022, and the Rep told me that they are still doing it , and that he knows about a lot of banks that disscuntinued the HELOC service, but TS is still open for HELOCs .

    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free