Using My HELOC as Down Payment and is it a Business Expense

[Will Bachino]

I'm about to purchase my first investment property. I'm going to use my HELOC as my down payment plus a 30 yr fixed rate mortgage. My questions are whether or not that's a good idea, whether I should count that interest only payment as a business expense when comparing properties or should I exclude that when comparing, so that I have an apples to apples comparison and a true cap rate in the traditional sense? Additionally if after the interest payment I'm still cash flow positive, is this a decent investment. I'm in Buda, a suburb of Austin, which is appreciating like crazy so I want to get in quick. I'm buying a $273k 4bd 3 bthrm... Thanks!

[Marian Smith]

6k in taxes! So every month vacant here on out costs $500 in taxes...should alarm you a little.  Sounds like you want everone here to congradulate you, but buying a brand new house in that price range that far out (where they are building lots of houses) at what is so far the height of the market in the peak season is IMO not cause for congrats.  Especially w/o money.  Sorry not from me,  but good luck.  PS, renters don't care as much about your new house as you do.  If renting out brand new houses made sense, DR Horton would have a rental arm.