HELOC STRATEGY TO BUY A SECOND HOME

[Shon Wheeler]

I have a 60k Heloc on my current primary residence, and was looking to buy a new residence to move into and rent out my current house. The residence I may buy has a value of 275k, the lender has me preapproved for 233k and it would cost me 49k in cash to close. I am skeptical about using my HELOC to do this because I would be on the hook for 3 mortgages essentially, and want some advice. The difference between the preapproved loan amount of 233k and the value of the home (275k) is 42k, does this mean I have instant equity? Would I be able to refinance the 233k mortgage with a different lender and pay the HELOC off? If so at what point? I've read different things about seasoning periods being 6 months to a year. I want an exit strategy to pay the HELOC off as quickly as possible. Any advice would be appreciated. Thanks in advanced. Btw I'm located in Georgia (not sure if location makes a difference or not).