HELOC on primary residence due if I move and rent it out?

[Andre Brasser]

Hi All,

I took a HELOC for ~$60k on our primary residence to fund a renovation on a rental property. My wife and I are planning on moving next year and we want to keep this house as a rental. Question is: If we decide to keep our current residence and rent it out, will the HELOC balance become due immediately once it is no longer considered our primary residence?

Primary residence: est. MV = $350k, current mortgage $248k, current HELOC $58k, net $44k.

Current rental: est MV = $375k, current mortgage $218k, net $157k 

One option is to do a cash out refi on our investment property to pay off the HELOC. However, my math leaves me a bit short in terms of $$$...

$375k * 0.75% (max LTV) = $281k - $218k (current mortgage) - $15k closing costs (est 4%) = $48k. That leaves me $10k short, which I could pay cash but fear I might be strapped buying our primary residence (203k project).

Are my assumptions reasonable? Anything glaringly wrong here? 

Thanks all,

Andre

[Mike S.]

I have a heloc on a home I moved out of 7 years ago..I still use it.