Ok, stick with me on this one...
I am a potential investor and I'm trying to figure out the best way to start. Here is a quick rundown of my current situation.
I own a house worth $210,000 - free and clear no mortgage
Credit score 808
I have $0 in CC and car debt... I'm virtually debt free.
I make around $30,000 and about to get married which is going to tie up a lot of my savings and current income. Unfortunately my fiancé is more of a liability than an asset at this time. She also makes about $30,000 but has a bunch of school debt and some CC debt. For obvious reasons I am not including her with any of the borrowing.
My plan: I would like to take out a HELOC and use it for either Down Payments or buy with cash and then refinance. I have been given estimates of up to 95% of my house worth. However, I don't believe that given my current income even with having zero debt.
Finally, these are my two questions:
Do I borrow as much as the lender will offer for the HELOC or should I only borrow exactly what I think I will need? example, if they offer 180,000 but I think 140,000 should be more than enough to get me started, Do I just take the $140,000 or grab as much as I can?
If I take out the $180,000, will future lenders see this and hold it against me because it is potential debt I could put myself into? My worry is that when I try to refinance properties, Lenders will see the open HELOC and hold it against me even though I my have only used 20,000 to 40,000 of it.
further details - I only plan on starting small like $40,000 - $80,000 (ARV). The last thing I want to do is empty out my HELOC. I just want to use it to get started.
THANK YOU!!! sorry for the length
