HELOC to purchase and repeat

[Derrick Cameron Jenkins]

I found out that the Credit Union I bank with offers 95% LTV HELOCs. I am taking this route to avoid losing my 2.2% interest rate while still accessing my cash. My application is currently processing and should be able to be approved. I'm just looking for the groups point of view on this idea. Interest rate on the HELOC is somewhere in the 4s. My idea is to use the money purchase a property for well over the 20% down threshold, refinance, pay back the HELOC, rinse and repeat with that with 2 or three properties. That or pool the money with a partner and purchase something larger. I would love to hear yalls thoughts on this.

[Daniel Somers]

I have used HELOC in the past to purchase rentals with. It is a great way to access cash that is tied up in your current home. Just read the terms as far as how long it is open for as far as paying back the loan, and have a backup plan if you are not able to refi right away. I always make sure it cash flows so if you cannot refi right away you can start paying back the loan with the cash flow until you are able to.