Local Investment Property HELOC Provider?

Question

Hi All,

I've been looking for a lender local to the Syr, NY area that will do a HELOC on a rental property.  So far i've checked with multiple banks and credit unions and found nothing.  Hoping someone might have done more work than me and can point me to a local bank.  so far i've only found TD Bank out of Albany who runs a prime +1.74 rate, plus annual fee and closing costs.  In case it matters  the property in question has about 50% equity.

Adam V. · Answer

Thought it might help to update this..  Pen Fed has a rule that if you have 4 or more properties in your name then they will only do a HELOC on your primary residence.  I don't plan to be in my primary long enough to make use of a HELOC so my options were to either pull my name off my primary or throw some properties into my LLC.  I chose the latter option and a week later i got the approval.  Hope this helps someone!

Adam V. · Answer

Just an update here for those who might find  this helpful.. Pentagon Federal will do 80% LTV on an investment property.  I applied last week and am going through the process.  Was pre-qualified for 25k with 12 year draw/repayment interest only @ prime +1.  So all in all not bad.  I'm told the formal approval process (confirming income/property equity etc) will take 4-6 weeks though so we'll see!

Brian Rosher · Answer

Navy Federal Credit Union will do a HELOC up to 70% LTV on investment property.  TD Bank is the other option as you mentioned.  I don't have personal experience with them yet.  The other benefit to the HELOC is you don't need to pay the mortgage recording fee, around 1% of the mortgage value like you would in a cash out refi.  Most banks can do a 75% LTV cash out refi conforming loan.

Adam V. · Answer

@David Cruice Primarily because i like the cash flow on the property where it is so i don't want to increase the monthly payment or see a rate increase.  If I get a HELOC (looking for interest only 24-36 months) i can get that cash paid back with the 1st year cash flow from my next property. And then use that LOC again and again in the same fashion to acquire more properties and not have to tap my operating cash reserves.

Adam V. · Answer

@Christopher Gifford They have a $10k minimum.  Can't recommend these guys enough; very responsive to emails and calls, quick answers to questions and handled everything over their website, email, phone and FedEx.

Christopher Gifford · Answer

@Adam V. thanks for sharing going to be looking for one in the next year. Any idea if they have a minimum line size requirement?

Adam V. · Answer

The properties were leveraged but i had plans to refi in '19 so i wont be too upset if they bug me about it.

Wesley W. · Answer

@Adam V. did you own those properties free and clear before transferring title?  Just curious on your risk appetite regarding the due on sale clause as interest rates ascend.

Rob Sawyer · Answer

That's good to know Adam, thanks for posting. Hope it goes smoothly for you!

David Cruice · Answer

Why are you doing a HELOC?  Why not do an FHA cash-out refi and leave 20% in the deal so you're not paying PMI?

Local Investment Property HELOC Provider?

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