Using a HELOC for a rehab property

[Sahleem Lee]

I have a good idea of how a HELOC works but not the full story. I want to use a HELOC for the rehab of an investment property that I'll be purchasing soon. But I'm at a halt because of the extra Reno cost that came up. So I thought about using the homes current equity as the repair budget.

Is the house appraised prior to the HELOC being issued? Or is it issued at its current value? Does anyone have any experience on doing so?

PP: 35k

Repairs: 50k

ARV:130k

After the property is rehabbed, I plan on renting, refinancing and paying off the HELOC. I'm

open to all suggestions, tips and tricks.