Getting a Heloc on a rental

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Getting a Heloc on a rental

Amy Houghton
Montrose, CO · Member since 2025 · 9 posts · 6 votes

I was wondering why lenders won't give helocs from the equity in a rental property.  Or if they do, its significantly less than if it was your primary home with a higher interest rate (9%).   Does anyone know a lender that will do this?  Thanks!

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Jay HurstBusiness Member
Lender · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
1y
Quote from @Amy Houghton:

I was wondering why lenders won't give helocs from the equity in a rental property.  Or if they do, its significantly less than if it was your primary home with a higher interest rate (9%).   Does anyone know a lender that will do this?  Thanks!


 Investment properties have higher rates even when they are first postion relative to owner occupied properties. Non owner occupied properties default at a higher rate then do owner occupied. If you get into trouble, which mortgage are you going to stop paying first?  The property you live in or one you bought for an investment?  More risk means higher rate. 

Second mortages are again higher then first mortages even on owner occupied because they are again more risky then a first mortgage. They are higher loan to value, and they are in second postion. That means that second mortgage holders are often wiped out completly during a foreclosure. So, more risk on a first vs second means higher rate. 

Now you add both together for a second mortgage and on a investment property so the risk is higher therefore higher rates and lower LTV's.

That being said, we can go to up to 80% LTV but the higher the LTV the higher the rate.

Hurst Real Estate, INC4.987 Reviews
WebsiteView Page
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  • Todd KimeBusiness Member
    Lender · KY IL TN FL IN · Member since 2022 · 25 posts · 5 votes
    1y

    Its all about risk,  Most lenders require a stricter set of guidelines on Helocs.  if ever default,  the Heloc would get paid 2nd behind the 1st mortgage.   So that is why its harder to get a Heloc on a rental property.  

    We do offer them if you want to reach out with any scenario.  Thanks

    [email protected]502-400-2345
    Statewide Mortgage LLC.51014 Reviews
    WebsiteView Page
    0Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    1y

    Check with a local credit union.  

    1Reply
  • Jay HurstBusiness Member
    Lender · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
    1y
    Quote from @Amy Houghton:

    I was wondering why lenders won't give helocs from the equity in a rental property.  Or if they do, its significantly less than if it was your primary home with a higher interest rate (9%).   Does anyone know a lender that will do this?  Thanks!


     Investment properties have higher rates even when they are first postion relative to owner occupied properties. Non owner occupied properties default at a higher rate then do owner occupied. If you get into trouble, which mortgage are you going to stop paying first?  The property you live in or one you bought for an investment?  More risk means higher rate. 

    Second mortages are again higher then first mortages even on owner occupied because they are again more risky then a first mortgage. They are higher loan to value, and they are in second postion. That means that second mortgage holders are often wiped out completly during a foreclosure. So, more risk on a first vs second means higher rate. 

    Now you add both together for a second mortgage and on a investment property so the risk is higher therefore higher rates and lower LTV's.

    That being said, we can go to up to 80% LTV but the higher the LTV the higher the rate.

    Hurst Real Estate, INC4.987 Reviews
    WebsiteView Page
    1Reply
    • Amy Houghton
      OP
      Montrose, CO · Member since 2025 · 9 posts · 6 votes
      1y
      Quote from @Jay Hurst:
      Quote from @Amy Houghton:

      I was wondering why lenders won't give helocs from the equity in a rental property.  Or if they do, its significantly less than if it was your primary home with a higher interest rate (9%).   Does anyone know a lender that will do this?  Thanks!


       Investment properties have higher rates even when they are first postion relative to owner occupied properties. Non owner occupied properties default at a higher rate then do owner occupied. If you get into trouble, which mortgage are you going to stop paying first?  The property you live in or one you bought for an investment?  More risk means higher rate. 

      Second mortages are again higher then first mortages even on owner occupied because they are again more risky then a first mortgage. They are higher loan to value, and they are in second postion. That means that second mortgage holders are often wiped out completly during a foreclosure. So, more risk on a first vs second means higher rate. 

      Now you add both together for a second mortgage and on a investment property so the risk is higher therefore higher rates and lower LTV's.

      That being said, we can go to up to 80% LTV but the higher the LTV the higher the rate.


       I see, thank you.  In my circumstance, my rental is my only home.  I just don't live there because I make more money renting it than if I was to live there.  The home where I live, I rent from someone else.

      0Reply
  • Jake YuskaitisBusiness Member
    Lender · New Jersey, USA · Member since 2022 · 254 posts · 67 votes
    1y

    There are lenders that do give HELOCs for investment properties. Have worked with a few. It is a pretty rare product though.

    [email protected]551-287-6884
    Frontier Funding LLC533 Reviews
    WebsiteView Page
    0Reply
  • Will Cook
    Lender · Denver, CO · Member since 2017 · 16 posts · 3 votes
    1y

    Hi Amy,

    I just finished a HELOC on a rental property (SFR) in Denver two weeks ago.
    The attorney client was very happy too. And get this, it was a DSCR HELOC.
    Our minimum is $150K and the LTV cap is 75.
    I hope that helps.

    1Reply
  • Todd KimeBusiness Member
    Lender · KY IL TN FL IN · Member since 2022 · 25 posts · 5 votes
    1y

    We will lend on an investment with a Heloc.   Its a good option for folks looking to take cash out and use those proceeds for repairs or another investment opportunity 

    [email protected]502-400-2345
    Statewide Mortgage LLC.51014 Reviews
    WebsiteView Page
    0Reply
  • Todd KimeBusiness Member
    Lender · KY IL TN FL IN · Member since 2022 · 25 posts · 5 votes
    1y

    let me add, we can even do Helocs when in 3rd position if there is enough equity etc.  

    [email protected]502-400-2345
    Statewide Mortgage LLC.51014 Reviews
    WebsiteView Page
    1Reply
    • Jaylon Cockrell
      Denver, CO · Member since 2024 · 19 posts · 4 votes
      1y
      Quote from @Todd Kime:

      let me add, we can even do Helocs when in 3rd position if there is enough equity etc.  


      Up to what LTV?

      0Reply
  • Todd KimeBusiness Member
    Lender · KY IL TN FL IN · Member since 2022 · 25 posts · 5 votes
    1y

    we can go up to 70% CLTV on 3rd position helocs

    [email protected]502-400-2345
    Statewide Mortgage LLC.51014 Reviews
    WebsiteView Page
    0Reply
    • Jaylon Cockrell
      Denver, CO · Member since 2024 · 19 posts · 4 votes
      1y

      @Todd Kime is this only if the first is a 30 yr note or could do a 2nd behind hard money debt too?

      0Reply
  • Bridget BrickBusiness Member
    Lender · Direct-to-Wholesale DSCR Loans | BRRRR & No-Seasoning Refi | 46 States · Member since 2025 · 53 posts · 11 votes
    1y

     @Amy Houghton We give HELOCs on investment properties. 2nd position. Up to 90% combined LTV. Min loan amount $50,000. Term length 10-30 years.

    Let me know if you have any other questions!

    [email protected]619-993-0504
    Get Brick Capital
    WebsiteView Page
    0Reply
  • Darren KurilkoPro Member
    Lender · Venice, FL · Member since 2025 · 15 posts · 0 votes
    4mo

    We are able to do business HELOCs on investment properties up to four units so we're able to do primary, secondary, and investment properties. Our application is frictionless and can fund inside seven days. The maximum LTV for an investment property is 70%


    Best - Darren Kurilko

    SizzleCapitalGroup.com

    941-800-8534 call/text

    Venice, Florida

    "We specialize in impossible situations."

    0Reply
  • Taylor Dansby
    Member since 2026 · 27 posts · 5 votes
    4mo

    Amy, that’s pretty common.

    A lot of lenders are much tighter on HELOCs against rentals because they view them as higher risk than primary residences.

    You may have better luck looking at investor focused lenders, DSCR lenders, or a cash out refinance depending on the equity, rent, and debt service.

    We help investors look at funding options for rentals, so happy to connect and see what structure might make sense.

    0Reply
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