Advice on financing my second investment property

[Gregory D Coburn]

I am looking for the best option to pursue my next rental property, I am pursuing the BRRRR method. I have done a lot of research but wanted to get some opinions of investors who have done this before. I plan to launch my real estate business on the side and build up properties until I am able to secure enough cash flow to potentially retire from my primary job.

My first rental was my primary residence so we have a decent amount of equity in the property (Current Market Value = $260K, loan $168K) and have a great 30 year fixed rate (3.25%). I currently have great tenants in the property and have a positive cashflow of $770 a month.

All in (purchase + rehab) my next property will cost me about $100k. I am looking for the best options to finance this, during the rehab process, prior to me refinancing after appraisal. I have a bank that will provide 80-85% LTV of the appraised value.

I currently have ~30K of liquid savings. The 1st rental property in my name, but plan to create LLC this year and transfer the asset, however I may delay that if i can benefit from using e HELOC or blanket loan to secure funding for my next property.

In addition my current home has a current market value of ~$420k with a loan of $297K. Assuming I get an 80% HELOC on both properties I would be just over $100K when combined with my savings. My credit score is 760+.

My Questions:

• How much should I expect to pay in fees for a HELOC or Home Equity Loan?
• Will a bank or Credit Union allow you to keep a line of credit open and allow it to go dormant between purchases?
• I could always go the hard money lender route but I am looking for ways to lower my costs getting into properties.
• Are there any other loans or whays that i can secure funding for my next property?
• Does my current investment property qualify for a HELOC?
• Would I be better of creating an LLC and applying for a BLOC loan? It looks like this requires a revenue history to qualify so this could be a deal breaker.