HELOC on Rental!

[Caleb Drake]

I have a performing STR in the Florida Panhandle that has around $100k in equity I'd like to tap into. Does anyone have a lender or is a lender who does HELOCs on rentals titled in an LLC?

[KC Pake]

Quote from @Caleb Drake:

I have a performing STR in the Florida Panhandle that has around $100k in equity I'd like to tap into. Does anyone have a lender or is a lender who does HELOCs on rentals titled in an LLC?

Hi Caleb,

To tap into the equity of your short-term rental in Florida, especially if the property is titled in an LLC, a few things to consider:

Lender Options: Look into HELOC lenders like Figure, Spring EQ, Hitch, and Bethpage Federal Credit Union, which offer various terms and rates for investment properties.

Qualification Criteria: You'll typically need a strong credit score (around 720 or higher), an LTV ratio of no more than 80%, and adequate rental income for debt service. Florida law requires retaining at least 20% equity and limits equity cash out to once per year.

Risks and Costs: Rental property HELOCs are seen as higher risk, leading to stricter approval requirements, higher fees, and interest rates compared to primary residences.

Funds Usage: HELOC funds can be used for property improvements, capital repairs, or as a down payment for additional properties.

Alternatives: If a HELOC isn't suitable, consider other options like a HELOC on a primary home, a home equity loan, a cash-out refinance, or a personal loan.

 
KC