What would you do? HELOC, sell, or other??

[Wade Cecil]

Hey everyone!

I want to purchase one or two STR's as soon as possible (Possibly in Sevierville, Pigeon Forge, Gatlinburg areas). I've researched the area and have a good understanding of the overall market.

I have 450k equity in my primary residence and about 60k in cash reserves. I am unable to STR due to neighborhood restrictions and long term rental doesn't make sense.

Here are the two options I’m considering (I’m open to other ideas):

Option 1: Take out a HELOC on my primary home. Note - I am unfamiliar with HELOC's and how it affects DTI ratio when purchasing an investment property.

Option 2: Sell my primary home and move into a family owned home for free (think 1940’s, no insulation, heated by a wood stove). This option would allow me more cash to deploy but my family would be “uncomfortable” with the living arrangements, but definitely doable.

I currently have two LTR mortgages and my primary mortgage. Thanks in advance for any advice.