I need some opinion regarding HELOC. I have one rental property that I applied for HELOC and only one bank(credit union) offered 90% LTV at 7.5%. Below are the numbers:
Appraised Value: $ 192,400
Current Mortgage Balance: $153,000
Interest: 7.5% (due to less than $25k and property is considered investment by the bank). credit score is not an issue but the higher rate is based on high LTV and because it is an investment property.
I will be using the HELOC to fund future projects/rehab and also as a reserved. Only cost is $420 for appraisal. Is this a sound strategy? I called local banks including credit unions in my area and they only do up to 80% LTV. Any input or advise is appreciated.
Thanks and regards to all.
so what did you end up doing, I am currently in a similiar situation. 95Ltv is very high ratio. very suprised to hear that. I guess that why interest is high also.
What bank did you go with?
Hi @Gonzalo Escobar , I used NFCU for that particular property and helped me tremendously to pay for repairs.
The interest at that time is high but my strategy is to pay it off <6 months and used the HELOC as additional reserves. I am just waiting another year to close this HELOC or renegotiate(to avoid paying the fees when I opened it up) due to property went up already in value plus to get better rates.
Thanks and regards.
I called nfcu they do 75% on investment properties. 95% for heloc and 100% for a loan if it is a primary residence.
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