How to use HELOC to Finance a Purchase

[Robert Chaiton]

Hello everyone! I've been trying to figure this out on my own for a few days now and can seems to figure it out so I'll ask some experts on bigger pockets. I am trying to figure out the HELOC works as a financial instrument, since the HELOC interest rate is variable not fixed what is the variable benchmarked to within the market and how volatile is this rate usually? Also when using the HELOC to purchase a property, how quickly would I be able to refinance this house in order to pay back my HELOC with the homeowner’s equity loan I can take out of the property? I am asking these because I am trying to convince my father that I can reduce his overall debt and get him closer to retirement by leveraging out full owned 100% equity in our vacation property. I want to make sure I fully understand how the HELOC terms work when barrowing from it and how fast I will be able to refinance out of my father’s HELOC thus repaying the total HELOC owed on our vacation property and now leveraging the LTV needed on my investment property. I will then use the cash flow from my investment property to hammer down my father’s overall debt. I know I asked a lot here, if you could clear up any of this that would be amazing Thanks for Reading Bobby Chaiton