Dallas-Fort Worth Real Estate Investor Club

HELOC on Rental

  • 06 Dec 2017 6:05 PM
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    Message # 5616007
    Jack McGee

    I am having devil of a time finding a lender that will lend on a fully paid off rent house.  Wells Fargo agreed to for $250 closing, but they want to see contract of the house I am going to purchase with proceeds. The whole point of pulling equity out of rent house is to pay cash for new house to live in. I will pay it off when I sell primary residence.


    I read Ridge Lending will do that, anyone know of anyone else that doesn't have that onerous requirement?
  • 07 Dec 2017 7:39 AM
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    Reply # 5616533 on 5616007
    Robin Carriger (Administrator)

    You're probably going to have to use a local lender with in-house underwriting.  I haven't needed to apply for a HELOC on a rental in a while, but a while back Bank of the West was willing to offer me one.

    Another idea is to just move in to your rental, thereby making it your primary residence.  HELOCs on your primary residence, as I'm sure you already realize, are much easier to get than HELOCs on rentals.  You will probably get better terms too.  I don't recall the amount of time a lender might require you to live there before approving you for the HELOC, but that info should be easy to find.  After you've lived in your rental for the minimum amount of time, you can use the HELOC to buy the other home you want, rent your rental again, and keep the HELOC.  It's a longer process, but it's one way to accomplish what you want.

    Thanks,

    Robin
  • 07 Dec 2017 8:36 AM
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    Reply # 5618480 on 5616007
    Neil Aggarwal

    Private lenders (myself included) will usually give cash-out loans on investment property, but their rates are going to be higher than a bank.  That may be another option to consider.

      Neil
  • 11 Dec 2017 4:51 PM
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    Reply # 5624102 on 5616007
    Andrew Postell

    Jack, finding a Line of Credit on an investment property is a challenge.  If you need just a straight cash out loan I can help with that but Southwest Bank will lend Lines of Credit on an investment property.  I just spoke with Mary Frost at an event this past week and she has always been my "go to" person over there for Lines of Credit on investment properties.  Feel free to call Mary at 972-919-1663 and you can drop my name if you'd like.  Thanks!
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