Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Starting Out
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated about 2 years ago on . Most recent reply

User Stats

9
Posts
2
Votes
Adam Francis
2
Votes |
9
Posts

Using Primary Home Equity

Adam Francis
Posted

I own my home outright and was considering using the equity in my home to invest in my first property.
Good idea? It seems like that’s what most investors do with their properties but assumed there were some cons when it’s my personal home. Appreciate the help!

Most Popular Reply

User Stats

54
Posts
42
Votes
Louis W.
  • Real Estate Agent
  • Oakland, CA
42
Votes |
54
Posts
Louis W.
  • Real Estate Agent
  • Oakland, CA
Replied

Using the equity in your primary home to invest in a rental property can be a good way to acquire additional real estate assets. However, it's important to consider the risks as well as the potential benefits before making a decision.

One of the main risks of using home equity to invest in a rental property is that you are using your primary residence as collateral for the loan. If you are unable to make the loan payments or the value of the rental property decreases, you could potentially lose your home.

Another risk to consider is that, as a landlord, you are responsible for maintaining the property and handling any issues that may arise, such as repairs or tenant disputes. This can be time-consuming and costly.

On the other hand, using home equity to invest in a rental property can also provide a number of potential benefits. For example, it can be a relatively low-cost way to finance the purchase of a rental property, and the rental income from the property could potentially help to offset the costs of the loan. Additionally, if the value of the rental property increases, you may be able to sell it for a profit in the future.

Overall, the decision to use home equity to invest in a rental property is a personal one that depends on your financial situation and your risk tolerance. It's important to carefully weigh the potential risks and benefits before making a decision.

Loading replies...