Cash Out Refinance to 10% equity?
I own a $300k home that’s approaching 20% equity. I am considering taking a HELO out to effectively drop my equity to 10% and give me $30k to purchase an investment property at 10% down. I have come across a strategy whereby I’d take $30k out on a credit card to use as the down payment with no fees. Then I‘d immediately do a HELO against my ”credit card debt“ and pay off the credit card off with the HELO. The thought behind this being that banks will offer a HELO to pay down usecured debt, but would not do a cash out refinance or HELOC when I’ve only got 20% equity in the one property. This would effectIvely give me $30k cash and 10% equity on each property if i purchased a second place with $30k down at $300k all in. BP...what do you think?