All Forum Posts by: Ian Stedman

This is a Heloc on my primary. I don’t have any other properties. Flip for money back quick seems appealing but further down the road I want some cash flow. I don’t understand leveraging against other loans.

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Champaign, Illinois

What would be the best use or strategy with a 75K HELOC to fund an investment property?

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Champaign, Illinois

Cash is certainly king but I gotta start somewhere. Analysis paralysis

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Quote from @Nicholas L.:

@Ian Stedman

there is basically no cash flow right now on residential. so if you just buy a random property with 100% financing, you'll never pay back the loans with the property - you'll be negative and have to pay it back with other money.

and if you BRRRR using 100% borrowed money you have to really knock it out of the park to get all your money back, which is very difficult to do as a new investor.

the way BRRRR works (as you know) is you buy (with money - cash from your checking account, cash from your uncle, hard money, a HELOC, a cm) fix the property up, then refinance. the refinance is supposed to pay off all the loans and cash used.

so if you use a HELOC for the down payment and finance the rest - that puts a lot of pressure on the deal because you're paying expensive financing costs each month.

My thoughts exactly. A lot of talk about how easy it but in reality you need a lot of cash. There’s a contradiction here. You said cash but then other ways to obtain “cash.” Can you clarify?

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Thank you all for your input. I'm in the process of securing the HELOC on my primary. There's more than one way to skin a cat and the one that resonates with me is the BRRR strategy. It all sounds good in theory but I'm either not understanding the fundamentals or I'm not familiar with my "refinancing out" options. I'm not necessarily concerned about being able to pay back the HELOC. I just wanna be able to one, increase the cash flow on the investment by not having a HELOC on top of a conventional loan and two, I want to repeat the process on a second, third, etc… investment property.

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I guess my hang up is that if I'm already using loaned money as a down payment, how will the bank approve another loan on top of the HELOC.

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Im wondering if i can use a heloc on my primary residence to either purchase or use for a down payment on an investment property and then refinance the investment property into a conventional 30 year mortgage to “pay myself back?” Any knowledge on this would be greatly appreciated, thanks!

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All Forum Posts by: Ian Stedman

Ian Stedman has started 2 posts and replied 7 times.

Post: 75k HELOC strategy for investment

Post: 75k HELOC strategy for investment

Post: Heloc to coventional loan

Post: Heloc to coventional loan

Post: Heloc to coventional loan

Post: Heloc to coventional loan

Post: Heloc to coventional loan