Heloc, why is it better if you have to eventually refi to pay it back, in some cases.

[Mario Morales]

For the purpose of buying properties, is it pretty common to take out a HELOC for 100K or so, and pay it back within 10 years, without a cash out refi? I mean, if the most common path towards HELOC repayment is refinancing, then why not cash out refi in the first place?

I'm trying to figure it out as I took out HELOC before $hit hit the fan and used it to acquire 2 properties. Now I'll be paying it back as the interest rates are higher and I need to payoff a few other expenses associated with the other 2 purchases.

[John Warren]

@Mario Morales I am going to go contrary to a lot of the advice on here, and I practice what I preach. I have a HELOC, and it has helped me acquire four buildings in the last 4 years. I hope to pay it back as well soon with a cash out refinance or through cash flow, but at the same time I am not going to lose sleep about a loan coming due in 10 years. Obviously, you need to be able to afford the debt service on it, and you need to make sure the new buildings are cash flowing well, etc.

RE is a long game, and one or more of your buildings will appreciate in the future. You will be able to cash out and get rid of that HELOC, or you will be able to pay it down out of cash flow. Also, you could sell your primary at some point and pay it off, and then buy another primary with a low-down payment loan. There are plenty of options as long as you remain flexible.