All Forum Posts by: Kevin Brandner

Hello BP,

I've done some searching of the forums and haven't found any names of lenders who will offer a HELOC loan for a paid off investment property.

I purchased a 4 family in cash recently. It was the best way to close quickly, I knew it would be the most attractive offer to the seller and I believe I got a good discount for going that way. I'm trying to unlock some of the equity in that home to help purchase future properties. I would rather HELOC than cash-out refinance to avoid closings costs. I've tried US Bank, Kemba, Heritage, the Farrell Group, PNC, and a small savings and loan. Most of these banks were referred to me by other lenders who didn't offer the loan product I'm seeking. The only bank I found that would offer anything close in First Financial. They can give me a HELOC but for a max of 65% LTV and it will have closing costs. Not ideal. Interestingly enough a couple of the lenders said if I had the primary mortgage through their company they could HELOC the equity but the primary mortgage was necessary.

Does anyone know any banks local to Cincinnati or otherwise that would offer a HELOC on a paid off 4 family?

@David Hildebrandt I enjoyed reading this advice, thank you!  I'm a new investor in Cincinnati. I closed on my first multi-family (a quad) on July 16th and advice like this is invaluable to us new investors of the world.  

Hello,

My wife and I are currently searching for our first investment property, hoping to find a small multi-family in the Cincinnati area.  We have a great real estate agent and are going through the pre-approval process for loans now so we are ready when we find the right property.  

Sine we own our primary residence one of the banks we contacted suggested we use a home equity installment loan (HEIL) saying that it would allow us to make what amounts to a cash offer on the property and secure the loan with a similar term and interest rate to a conventional loan and the added benefits of no closing costs.  

We've done plenty of research before beginning this journey and have read about various financing options. Most of the time books mention HELOC's or conventional loans before moving on to other more exotic financing options but this is the first time I've run into a HEIL option.

Since we have additional cash to put the required down payment on a conventional loan I'm inclined to go that way and avoid collatoralizing our primary residence but can someone help me understand the key differences between HELOC and HEIL and why I might be wrong in choosing a conventional loan over the existing equity options?

Thanks!

Congrats on your BRRRR success! Will you try and find a similar property and do it again?