Use my Primary Residence to finance my first BRRRR?

[Heath Cejka]

Hello, 

I am a new investor and am figuring out what real estate niche I am wanting to do and BRRRR looks like to be the one that will work best for me.

With that being said I am looking to buy my first primary residence property (SFH) and I am wondering is it a good idea to use this property to refinance and use that financing and use to start my BRRRR investing? I will most likely using a conventional loan with 20% down if not more for my home. But please help me understand what are the pros and cons of using my own primary residence to refinance and use the money from my refinancing to start buying BRRRR properties.

Thanks, 

Heath 

[Jay Hinrichs]

get qualified for your take out on the refi before you get over your ski tips.. 

risk is a retrench in values and your heloc gets frozen or called..  you now have NO real equity in a non appreciating rental. with no way to pay the heloc off.

read the fine print of helocs  they are not fixed term loans.. they can be frozen and called at the discretion of the lender. 

I like it for flipping.. or if your darn sure you can retire it with a refi on a rental.

but keep in mind many people try this BRRR only to find out they cant get all their money back on the refi now your stuck with loan on your house and a rental and probably next to nothing in real cash flow since you have a first and a second..

those are the down sides everyone else will talk about the upside but just protect your primary..