HELOC on Primary Residence or Rental Properties

[Erwin F.]

I'm thinking of pulling HELOC but want to understand the PROS and CONS. I'd like to pull about 100K to keep on the sideline until I find my next great deal. Here's the stats.

• Primary Residence (SFR) has about 250K in equity
• I have 2 condos with 120K in equity (no mortgages on these)
• I have 1 townhome with about 100K in equity (70K mortgage left)
• I have good cash reserves.

[Daria B.]

@Erwin F.

I got my HELOC from Regions bank and they did it on the primary with no closing costs. I also contested the "drive by" BPO since the report compared my property to those that they had internal knowledge of (improvements). That's apples and oranges. When I showed I had upgrades to rival the comps, they ordered an appraisal and I got $30k more that was considered after the 80% LTV. I did not have to pay for the appraisal.

Regions will consider an investment property as I was going in that direction but the one property I wanted to use is in MD and they don't have a banking presence there yet. From what I was told, there is no difference in cost, of there where any. Closing costs are incurred when the account is closed in less than 2 years. I'm on my 2nd year now but I have no intension of closing it.  

You can likely choose any of those to HELOC. The more you have LTV the more you will be able to utilize better.

Good luck.....