Can You Do HELOC on Rental?

[Bob Asad]

If my primary residence has $500k HELOC, could I use it to purchase a 2nd primary residence and rent out the first one?

And if so, as I'm paying down the original primary residence HELOC, in the future, can I use it again to purchase a rental investment? (Given that my new primary residence also has the equity from first residence HELOC)

In other words, when your original primary residence becomes a rental, can you still do a HELOC?

Let me know if this makes sense. Thanks

[Carlos Valencia]

Hello Bob, 

You can get Helocs on your investment properties up to 75% CLTV. As long as you can meet the guidelines to get 75%CLTV and have enough equity then you can proceed. If you do qualify you would basically be refinancing your current Heloc and use the new Heloc to pay it off the original Heloc. Best to do Heloc when the property is being used as your primary so you can ge the max CLTV of 90% because once its considered an investment your max is 75%CLTV. Plan accordingly so you are set up appropriately.

@Albert Bui @Matthew Kwan