Do you want to buy more rental properties? Once you have the HELOC explained, it starts to make sense why so many real estate investors use them. If you’re not an investor, you may have never thought about getting a home equity line of credit (HELOC). But, if you’re trying to quickly scale your rental property portfolio and start stacking units, the HELOC can be your best friend. Not only is a HELOC almost instantly accessible, it also gives you ultimate freedom in funding your future flips, BRRRRs, or regular rental property purchases.
Tyler Madden used a single HELOC to buy seven rental units, proving how great this strategy is. Even if you don’t have a ton of equity in your home, there’s a chance that you could use some of the principal you’ve paid off to help you fund your next down payment, rehab, or repair for another property. This means you won’t have to ask private or hard money lenders for a loan, and by default, skip out on their high interest rates and big fees.
But before you call your local lender and ask for $100k of equity as credit, hear out Tyler’s pros and cons. There are some things about the HELOC that you should know before you apply for one, as a HELOC is a bit different than a traditional loan. But, if you have equity, and want to grow your rental portfolio, this is a strategy to keep on your radar.
00:00 More Rentals for Less Cash 00:31 Using HELOCs to Buy More Property 02:09 How a Home Equity Line of Credit Works 03:46 Where to Get a HELOC 04:53 How to Use a HELOC 07:01 Pros and Cons of Using a HELOC 08:36 Got Equity? Go Buy Rentals!
