Advice on financing or HELOC for long term rental w/ no debt
I own a single home rental property free and clear. Purchased it with cash last year and now want to pull out cash to repay myself as much of the purchase price as possible. Should I get a traditional mortgage and take cash out, or a HELOC on this property.
I have a long term tenant already whose lease payment can pay down the mortgage/HELOC. Some interior only repairs have been completed. Tenant may one day wish to buy the property. Due to the lower purchase price, the interior repairs completed and new HVAC the relator advised the property should appraise 15% - 20% higher.
Decision - pursue HELOC or mortgage on this property?