Does a HELOC make sense in this situation?

[Jon Haney]

Hi everyone,

Currently I own two investment properties, and I'm considering taking a HELOC on my first property to cover a down payment for a third. This is my first time with any sort of creative financing, so I wanted to run some numbers by you all to see if this would make sense or not.

Property value of first property: $95,000

Amount owed on mortgage: $44,000

FYI: I’m cash flowing at around $500 between our first two properties, I’m able to set aside $1,000 a month in personal savings from my W-2, and I have around $13,000 in savings with no debt.

Does taking a HELOC work under these circumstances?

I’m sure that I’m missing some important information, so feel free to ask a follow-up question for more details! Thanks for the help everyone.

Jon