HELOC 7.5%

[Leo A.]

Greetings,

I need some opinion regarding HELOC. I have one rental property that I applied for HELOC and only one bank(credit union) offered 90% LTV at 7.5%. Below are the numbers:

Appraised Value: $ 192,400

Current Mortgage Balance: $153,000

Interest: 7.5% (due to less than $25k and property is considered investment by the bank). credit score is not an issue but the higher rate is based on high LTV and because it is an investment property.

I will be using the HELOC to fund future projects/rehab and also as a reserved. Only cost is $420 for appraisal. Is this a sound strategy? I called local banks including credit unions in my area and they only do up to 80% LTV. Any input or advise is appreciated.

Thanks and regards to all.