Line of Credit for 5 Unit Property

3 Replies

Hi All -

I have substantial equity tied up in two investment properties (a 5 family commercial property and a 3 family residential property) which I would like to access through Line of Credit products. However, I've called a range of lenders (banks), small and large, and so far none of them are willing to issue a Line of Credit for non owner occupied investment properties. Both of my properties have existing mortgages in first position and the existing first mortgage lenders are recommending a cash out refinance. I'm reluctant to do a refi since I have great rates locked in and I'm not 100% sure when I will need access to the credit lines, plus I'd rather avoid increasing my payments until I need the money. I'm hoping that some of the experts here with more experience and knowledge in this area could point me in the right direction. I don't think the intended use of the Line of Credit should matter, however, I am hoping to use the credit line to finance new business opportunities . . .

Thanks in advance,

Andrew

@Andrew S. just spoke with my commercial lender in CT, he said they do offer lines of credits on commercial properties in 2nd position. However, they have to be behind their 1st loan. He doesn't know of any other banks that do this currently around here. 

What is your interest rate and terms? 

What town? 

@Andrew S. TD Bank will do a HELOC for the non owner occupied 3 family. They require that you do not own more than a total of 4 properties mortgaged or not

@Scott Hollister - These properties are both in Danbury, CT. The 3 family has a 30 year mortgage at 4% with 25 years to go. The 5 family has a 20 year 5/5 ARM at 5.1% (just reset) with 15 years to go.

@Victor N. - Thank you for the lead on TD Bank, I'll reach out to them today.  As it so happens, I own 4 properties so it should be an option for me.

Best,

Andrew