Refinancing my duplex

[Michael Gelatt]

Hi all. Looking for some advice. I purchased a rental property last year that is titled under my LLC. I purchased the property with cash after I took out a HELOC on my primary residence. I first transferred the money from my personal bank account to my business account and bought the home out of my business account in a effort to keep finances separate. I am now receiving monthly interest only bills on my HELOC which is currently at a variable rate of 7.25%. Because the interest rate is so high I plan to refinance my duplex and take a commercial mortgage out on it under my LLC. Then I will take those funds, transfer them to my personal account and pay off my HELOC. I will then use rental income to pay off the commercial mortgage and other expenses.

1. My first question is: which account should I be paying the HELOC bills from? My personal account or my business account? The bills coming from the HELOC interest are made out to my personal name, not my business name, since the HELOC was taken out under my primary residence. And if I should be paying them from my business account, do I write a check directly from my business account to pay off the HELOC or do I first transfer the money from my business account to my personal checking account and then pay the bill out of my personal checking account? Basically, I am trying to be careful to not "pierce the corporate veil" in case it ever comes to that.

2. My second question is that I am also planning on refinancing my primary residence since interest rates have dropped. Yesterday when I spoke to my lender, they said I could just simply roll The balance I have on my HELOC into my refi. Since this will be a "cash out", the interest rate would be slightly higher but doing it this way would then mean I do not have to refinance my rental property, saving me those costs.

 Any advice would be much appreciated if you have gone through similar issues!