All Forum Posts by: Michael DeVowe

@Gerardo Varela

All great words of wisdom from @Tim Jones and @Arlen Chou.  As long as you have equity in a property a HELOC is a fantastic way you can borrow against it.  I would give  work of caution though to balance out the thoughts.  If you are only able to use your own personal property to get the HELOC then that may be your only choice but I personally do not like to tie up the home that I am living in to my investmets.  That way if the market burps, my home is not in jeopardy.

I would suggest using the property that you purchase to get your HELOC. Now of course this is only if you are able to find, borrow, etc funds to get the property. Here is an example of how I just did it. So I am not a banker but I have just recently done 1 HELOC and am on to my 2nd, so I can tell you what I know. I just purchased a property for $10,000, in North Dakota, completely rehabed it and am renting it out. Since I have done this before I know that the ARV (After Repaired Value) was going to be around $70,000. So once I put the renters in I immediately turned around and tried to get a cash out refi on it. The plan was going well and a cash out refi would work BUT the banker sucked at his job so I looked locally for another solution and found a HELOC solution. Good thing too because the cash out refi was, like the guys said was going to cost me more.

At my local bank, I found that they were willing do give me a Home Equity Line Of Credit on the property AND here is the best part, it cost me NOTHING!!! except the price of an appraisal. No closing cost, No points, No fees of any kind except for the interest on the line of credit which is only on what I pull out.

So again - if you don't have to use your personal home I would recommend going that way 1st but if that is the only way, a HELOC is a good option.

Glenn