All Forum Posts by: Corby Goade

HELOCS are usually variable rate, prime plus, depending on your LTV. The benefit is that you living there when you open the HELOC will allow you to access way more equity than you could with a cash out refi, plus you don't have to pay any interest until you actually draw on the account PLUS, many banks don't even charge closing costs on HELOCs. Heck, some of them will even pay for the appraisal. Honestly, to me that's a no brainer. To address your specific questions:

1. We use the money to purchase on one or two new properties during the next couple years; 

Use the HELOC to either pay cash for new properties and make aggressive offers, or use it as a down payment with conventional financing. You can refi the property right away and pull your cash out at 65% LTV or wait a few months and get a loan at 80% LTV, give or take.

2. It may be up to 5 years before we use it for additional purchasing properties; 

If this is the case, paying interest on your cash out refi for five years would be insane. With the HELOC you pay nothing until you use it.

3. Money is used to remodel and expand current property and create additional rental unit in next couple years;

I still say HELOC, though this scenario makes the most sense out of all of them.

4. Some is used for property and some is used for "family investments" like travel, etc., in the next couple years: 

Regardless of where the money comes from, it's not a good idea to borrow money for travel or anything else disposable or fleeting. Would you want to still be paying 4% interest on a Disneyland vacation from 1989?

Opening a HELOC now is likely to not cost you anything and you will lose the opportunity to do so once you move out.

I don't have any experience with this, but a couple thoughts (if you don't have luck with the DMV). Check with your title company to see if they either noted the trailer on the property and/or know how to deal with this. You could always call your RE agent and ask them to contact the seller and see if they can help. Good luck!

Even if you could make a case, sounds like way more trouble than it's worth. I'd hire a professional cleaning company for a few hundred bucks and chalk it up to an education. You'll be carrying around way more than $500 worth of stress if you sue, not worth the energy. 

I'd have that exact conversation with the agent- if you are honest and open, I'll bet you'll get a positive response. I'd tell him that you are looking to buy, but are planning on making lots of aggressive offers on inexpensive properties in an effort to learn and get screaming deals. Tell him that you feel like you'd be wasting his time, but would be interested in learning from him as a mentor- maybe you can set up a monthly lunch and bring him some questions. Buy him lunch, send him thank you cards, etc. It's likely that he doesn't want to waste time making dozens of lowball offers on your behalf, but would be willing to share his knowledge with you. Best of luck!

If your parents aren't retired, why would you need to hold a mortgage for them? I think you are on the right track in your last sentence- why not buy a house and rent it to them. Of course, there are all kinds of family dynamics to take in to account, but that is a risk only you can assess. 

Why not get a HELOC before you move out? It's the best of both worlds- you get a higher LTV and the flexibility of using the money when and where you want, without the stress of paying interest on it while it sits in your mattress. Plus you'd have more money to play with, you could likely get 95% LTV.

Is it possible to phase it out as tenants vacate each unit? If not, you are going to cancel it sooner than later, right? If so, I'd just rip the bandaid off now. Maybe give tenants 30 days notice so you aren't on the defensive when their service stops working. 

What are your intentions? Do you want to rent it out? Fix it up and sell it? Is it in a park? Does it come with land? 

How would you structure the deal? You are either dealing with cash or conventional financing, correct? Are you proposing owner finance?

We need to know a lot more about this in order to help. Is this a SFR? How long has it been vacant? Where is the property? Have you done market comps? What are your screening and tenant criteria? Tell me more, I'd be happy to help.