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Updated over 1 year ago on . Most recent reply
Question about leverage
Hi BP community,
I'm a brand new investor in the process of completing my first purchase of a single family rental. I am leveraging a HELOC on my primary home to fund the 25% down payment for the investment property. Planning to get a low/no cost mortgage to close and then refi later to get some money out. My question is, how do I go about buying my 2nd/ 3rd properties and so on. Here are some details that might help with your answer:
Primary Home equity ~$2M (not including the HELOC)
HELOC $500k with 15 yr draw & 15 yr repay
Rental investment property ~$550k
Cash Flow ~ $50-$100/mth
I do realize that I will end up paying interest on the HELOC that I draw from for the down payment, which will be larger than the cash flow from the investment property.
Again, appreciate any help you can provide in helping me understand how i go about leveraging assets to buy my 2nd and 3rd properties and so on.
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