Strategy to fund $400k property with HELOC?
I currently have a HELOC line of $200k. I am using it to buy all cash for smaller SFHs for the BRRRR strategy (i.e. $100k house purchase, $30k rehab) and then plan to refinance to pay off the variable rate from my HELOC into a traditional 30 yr loan (typical stuff here).
However, I want to scale faster for a multi-family (4-plex? 6 to 8 unit apartment complex). Let's say I find a $400k property. What strategies are available to make this play?
I prefer not to use hard money / private money unless I have to).
Would it makes sense to do a 25% down payment ($100k) from my HELOC and do a conventional loan for the remaining 75% ($300k?) If so, am I supposed to do a cash out refi after seasoning period to pay back my $75k HELOC down payment (to get out of that variable rate). Would I need to utilize BRRRR to make this strategy make sense since I can get an appraisal for a higher ARV than $400k?
I guess my issue is I want to scale up to $400k properties but my HELOC is only enough to fund smaller projects. I know I can use hard money / private money to fund my remaining 75% but again, I prefer not to.
Let me know what everyone thinks.
However, I want to scale faster for a multi-family (4-plex? 6 to 8 unit apartment complex). Let's say I find a $400k property. What strategies are available to make this play?
I prefer not to use hard money / private money unless I have to).
Would it makes sense to do a 25% down payment ($100k) from my HELOC and do a conventional loan for the remaining 75% ($300k?) If so, am I supposed to do a cash out refi after seasoning period to pay back my $75k HELOC down payment (to get out of that variable rate). Would I need to utilize BRRRR to make this strategy make sense since I can get an appraisal for a higher ARV than $400k?
I guess my issue is I want to scale up to $400k properties but my HELOC is only enough to fund smaller projects. I know I can use hard money / private money to fund my remaining 75% but again, I prefer not to.
Let me know what everyone thinks.