Best way to tap into equity

[Amod Karve]

Hi All,

I would like some advice on the best way to tap into the accumulated equity in one of my rental properties. I am close to owning the property free and clear in the next year. The house is currently worth 410K with my equity being ~370K. The monthly cash flow is ~$200 (I know this is suboptimal, but this is my first ever home that I converted to rental, so...)

My question is: Is there a way to tap into the equity of this rental while increasing the monthly cash flow using creative financing. I'll probably end up refinancing a couple of years down the road, so open to creative suggestions. 

Thanks

Amod

[Albert Bui]

HI Amod,

You can use:

- HELOC or home equity lines of credit or commercial lines of credit to access the equity

- you could cash out refinance with 30 year fixed notes, currently in the mid 7's (roughly 700 for every 100k borrowed per month)

If you're already netting 200 cashflow a month, you may want to limit your access to this equity or consider that the use of this debt vehicle will cause your current property to probably go negative in terms of cashflow, if tapped.