HELOC on rental properties

[Daniel Kokodoko]

Hello, we have 2 rental properties in Salt Lake City, and both have conservatively at least $200K in equity in each. We would like to open a HELOC of $100K on each. Does anyone know an investor friendly lender that would do this? Credit score, debt to income, and gross income should not be an issue. Both properties have positive cash flow (+/- $300 per month), and have 30 year fixed 3.25% loans. The lines of credit would be used to potentially fund new deals.

Thank you

[Chris Potter]

@Daniel Kokodoko I just completed my second HELOC (Zions bank refers to them as HECLs) on a rental property. They were both with Zions bank which is a Utah/Idaho bank. They stopped doing HECLs on investment properties through COVID, but started doing them again the last 6 mo or so. It wasn't too hard to get them done, but I have really good income and very low DTI. The HECLs they do on primary residences are great because they are no fees so I did that as well. The HECLs I did on my rentals have fees involved, but definitely worth it. I think my fees with origination, appraisal, title fees were between $2500-$3500. One did a drive by appraisal which saved me about $650 and the other drive by appraisal came in so low that I requested a full appraisal which I had to pay for. My rentals have 1st mortgages at 2.875% so that's why I went with the HECLs in 2nd position since there is no way I will be refinancing those first position deeds of trust anytime soon. Another credit union that will do these is Goldenwest CU. I don't know if you have those in CA but they are in Utah. I would imagine most CUs will do them. I would shop around and look at all the fees, rates, etc. The other nice thing with Zions bank is that they gave me 6 mo promo rates at 4.5%-5% on these HECLs and then they bump up to maybe 1-2% above prime? I haven't really paid much attention to what the rates will be because I imagine most banks are pretty similar. I think these took around a couple of months each to get these done and that was with Zions already having most of my documentation from my primary residence HECL. Last thing I will mention is that Zions bank will only do 3 HECLs for one person so I'm now tapped out. I hope that helps, good luck.