Buy Strategy

I saw this in another post, thought I would start a new thread.



What I would like to do is purchase property with cash (save on the closing costs) and then get a "No Fee Home Equity Line of Credit" with interest only payments.



Anyone think of any negatives with this scenario?

Comments(5)

  • bargain7626th June, 2006

    My CPA told me that only $100k of a HELOC loan can be used for ibvestment purposes and and have interest costs deducted.

    Are you within that limit?
    [addsig]

  • ttime26th June, 2006

    Most properties will be above that mark in my area. I was thinking of using the HELOC to finance rehab work and hold costs until sold retail. Or, pull as much cash back as possible but leaving a low enough balance for a positive cash flow.

  • ttime26th June, 2006

    Thanks Joel!

    Now that things seem to be back to normal I will bump this thread.

  • ttime27th June, 2006

    Thanks for the replies, it sounds like the way to go for now.

  • jasons7th July, 2006

    Expect a higher interest rate on a non-owner occupiend LOC than on a non owner occupied 1st mortgage.

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