HELOC Utilization for investments

[Manuel Vargas]

I currently have three rental properties. One has a lot of cash flow and a substantial amount of equity. The other two have limited cash flow and minimal equity. I would like to create more cash flow and possibly and more properties to my portfolio. Do investors recommend actions like HELOC to purchase additional properties(ie: 20% down payment)? Or HELOC from 1 said property to add additional down payment/ refi on currently owned properties?

[Whitney Hutten]

@Christopher Smith I leverage my HELOC all the time to fund projects (kinda like a mini-bank). For starters, call your lender and ask them to lock the rate for 1-3 years. The worst you will hear is NO. But you might be surprised that they will actually do this. They only make money if you are using the proceeds and if locking the rate for a year gets you do that, then fantastic win for them.

The next trick is pay that HELOC off as rapidly as possible. $150/mth is not that much, but if you start buying multiple properties and putting in monthly savings, then you can snowball it down pretty quickly.