Rehab personal home taking funds from rental property equity

[Lisa Albright]

Hi All,

Newbie here, just a quick question we are building an addition on our second home, we have a primary residence, and two rental properties. We are trying to not use our retirement funds. Are there any strategies here to utilize bank funds for our project? Thank you in advance to a great community!

L

[Steven Goldman]

@Jake Baker  You should think about a rehab loan if you are going to buy and hold. You will incur more lending costs but you will only be in the first loan for 6 months. Some rehab lenders have favorable refinancing programs to convert the rehab loan to permanent 30 year financing. Most rehab loans offer 85 to 90 percent of the purchase price and 100 percent of the renovation costs. It allows you to use a small fraction of your own money. Good luck and keep moving forward!