Using HELOC as a down payment

[Christopher Ward]

Hello everyone, 

I'm considering using a heloc for a downpayment on my first property, however every time I run the numbers through the rental property calculator, the monthly cash flow in usually under $100. I understand the reason behind this is I have a larger P/I payment which eats into the cash flow. My ROI usually is good due to me only paying closing costs and repairs.

In this situation, is accepting a lower cash flow acceptable if I'm doing it low money down? I know Brandon Turner states $150 to 200 is good monthly cash flow but I believe he factors in a 20% DP when I see him use the calculator. 

If I used a heloc, I would refinance into a 30 year loan before the APR rate increases.

Thank you for your time, 

Chris 

[Account Closed]

Christopher Ward - I have built a sizable portfolio and have contributed no additional cash outside of financing the down payment and renovation costs on the first property.

If you can pull money out of your foster investment property to by another and still cover your costs, in my mind it's a no brainer.

You are essentially acquiring assets with now cash out of pocket!