Home Equity line and purchasing small multi family.

[Aaron Harren]

Looking for advice on HELOC's. I recently used a HELOC for a down payment on a duplex. Now I have taken an addition line out on our house and wondering what is best with using this money for purchasing another property? But the entire property with it? Use it as a down payment again? or any other ideas? My line is $156,000, rate is 5.6%.

Thanks in advance!

Aaron

[Greg Miller]

I also used a HELOC to buy my first single family several years ago. It started the ball rolling for me. I would only use the HELOC for the down payment. With interest rate going higher in the future, you want to lock-in lower fixed rates when you have the opportunity. You will probably see your HELOC rate increase again in the next few months. Mine recently went higher.

As an example, I did a cash-out refinance 7 years on our second single family.  A national bank gave me a 15-year fixed rate at 3.625%.  I will not pay this loan off early, because the money is so cheap.