What's the max ltv on a primary residence? You mentioned 50% of equity. If there is $300k in equity after a first mortgage, then that would allow for $150k line of credit? Credit score, dti, reserve amounts required?
It definitely can be expensive but that is dependent upon your strategy. You have a lot of investors who need gap funds to take care of a rehab. For example, if you're a flipper who's looking to be in and out on a deal, then it's not a bad product. If you can replenish what you use rather quickly (again, dependent on your strategy), not a bad product. However, if you plan on maxing out the line and it takes you a year or more to replenish it, it's definitely expensive. This is not a loan @Adam Morgan, therefore it doesn't function or cost as such. But it is a revolving line and you can keep/use it as long as you like.
@Copelon Kirklin, I am going to advise you to close your add and seek the advice of a lawyer before putting it up again. Lending is tightly controlled even for pawnshops. Your rate exceeds even their laws. Just posting your add and having it be shown in Wyoming is illegal. I did a quick check on usury laws and every state I checked has limits well under your level. The penalties for violations I saw range from being liable for 3 times the amount of overcharge to jail and not being required to pay back the loan. If you can show you are legal I would be glad to look it up and give an apology if I am wrong. I am positive it is not legal in many states. I know everyone must make a living and this might help some folks, but this add is a crime as far as I can see. If you want to do this right try asking folks like @Jay Hinrichs or some of the other lenders on here for help. @Joshua D., or @Brandon Turner, might be able to steer you towards other lenders as well.
@Copelon Kirklin, I am going to advise you to close your add and seek the advice of a lawyer before putting it up again. Lending is tightly controlled even for pawnshops. Your rate exceeds even their laws. Just posting your add and having it be shown in Wyoming is illegal. I did a quick check on usury laws and every state I checked has limits well under your level. The penalties for violations I saw range from being liable for 3 times the amount of overcharge to jail and not being required to pay back the loan. If you can show you are legal I would be glad to look it up and give an apology if I am wrong. I am positive it is not legal in many states. I know everyone must make a living and this might help some folks, but this add is a crime as far as I can see. If you want to do this right try asking folks like @Jay Hinrichs or some of the other lenders on here for help. @Joshua D., or @Brandon Turner, might be able to steer you towards other lenders as well.
Just to clarify to everyone on this post, the usury laws referenced apply only to LOANS and not CREDIT LINES. A revolving line of credit is akin to a credit card, which is not subject to an usury laws. Which is why your credit cards normally carry such high interest rates. See the link below...
I stand corrected, it appears a nationally chartered bank sitting in a state where there is no usury law, namely South Dakota and Delaware, are exempt from usury laws. So if these loans are being offered by a nationally chartered bank it might be wise to list the banks name. that will clear up all doubt on legality. The case name was Marquette and it was decided in 1978.