HELOC Question
It was brought to my attention about possibly taking a HELOC out on a property in order to retrieve the funds to do repairs.
I was curious if I had purchased a property in excess of 40% below ARV, and the ARV appraised approx. $90k. Would the HELOC generally be based on the $90k or how does that exactly work?
Would this be a more typical, or easier way to acquire the funds to do the repairs than taking out a HELOC on my own property PRIOR to getting a loan for the investment property?
HELOC 2nd mortgages are strictly based on credit first, income second. If you qualify you can go off of the appraised value. PNC or National City will use an AVR system to determine your value and go off of that. For either a primary or an investment property. I bought a house in Greenfield for $29,000.00 in Nov. 2001, PNC gave me $52,400.00 HELOC in Dec 2001. So they do not make you wait a specific amount of time. As long as you qualify. I had to pay them $80 for costs. But you must qualify.
Laurie
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Create a note and sell at discount depending on how strong the equity is.