Line of Credit vs Mortgage- Interest rates & fees

[Mak K.]

Hi,

I have always been a cash buyer and this is the first time I am looking at a lender for a deal. I am trying to decided the differences and especially the interest & expenses associated with the different type of loans. This is my understanding but please help me to get a clear picture.

Lets take $100,000 for the amount to be loaned out.

1> Line of Credit (based on stock portfolios)

- Lender says it will 0.5% origination fee ($500) one time cost

- Lender says prime -MINUS 0.5 = 8.5-0.5%= 8% loan as of today.

- No other fees or cost. I can withdraw and payback as needed. Only thing I need to pay is interest every month.

- More like a credit card where you limit is fixed. You pay interest based on what you use.

- Floating rates so I guess rates would go down as FED cuts the rate

2> Mortgage on property

- Lender says if it is LLC, then it is prime plus 2.5% = 8.5% as of today

- Lawyers & lender fees to be added- COST ADDER

- Survey and appraisal to be added- COST ADDER

- insurance, property taxes on property required etc to be maintained etc

Per my discussion, it looks like LINE OF CREDIT based on stock is easy and cost effective. Am I missing something? Anything I need to know?