Refinancing a Home I Don't Live In

[George Otiono]

I've been doing research on HELOC vs. Cash Out Refinance and I'm so confused.

In 2015, I purchased a property for $247,000 and lived in it for 1 year and 1 month. It is now worth $380,000 and I owe $199,000 on it. I do not live in the property now. According to Bank of America, I cannot get a Cash Out Refinance because it's not my primary residence.

As a result, I can only do a HELOC with my interest rate estimated to be a 5.17% (it's currently 4%).

I'm a little lost on how to proceed. I want to have enough money to make a down payment on a second home, but I'm not sure it's possible (re: smart) given my interest rate would increase by 1.17%. Am I assessing the situation incorrectly?

[Shaun Weekes]

@George Otiono

B of A is 100% incorrect. As long as you qualify from a credit, income and asset standpoint you can do a cash out refinance on your home.