This is the best video I have seen on how to leverage your current equity to buy another home or investment property. Straight forward, easy to follow, and extremely understandable. Walked away feeling more knowledgable on potential nexts to consider when expanding our real estate portfolio. Thank you!
Hey there! Thank you so much for your kind words and support! I'm really glad you enjoyed the video. It's great to hear that the visuals, slower explanation, and detail resonated with you. If you're ready to take the next step and start on a pre-qualification, you can head over to www.winthehouseyoulove.com. Thanks again!
Using credit (including a HELOC) as part of your down payment can have some gotchas. Many lenders will want a "seasoning" period between the time you take money out of a HELOC and when you are being approved for a mortgage on the new property. 3 months is a common seasoning period. Also keep in mind that your HELOC will likely be treated like a credit card on your credit report and credit score. That means that if you withdraw more than 30% of your HELOC limit, that can have a substantially negative impact on your credit score, which can make it harder to qualify for a new mortgage or get good terms on a new mortgage.
You're absolutely right, Eugene! Seasoning periods and high HELOC balances can indeed impact your mortgage approval and credit score. Always wise to plan ahead and ensure your finances are in optimal shape before applying. Thanks for watching!
This is exactly the video I need. Plan to move in 2 years. My home has about 100K in equity ( so they say,fingers crossed). Right now my dti is high. Doing gig jobs to lower that debt to qualify for a heloc to knock out more debt before buying another home. Maybe. I need advice.
Thank you so much for your kind words! I'm thrilled to hear that you found the video helpful. If you need further assistance or have questions about using equity, feel free to reach out!
5% down payment is crazy to me, I guess I need to look harder in my area. 5% down vs. 20% down makes a huge difference in whether the deal will work or not. Great video around the general concept. Thanks.
@@primatrader And that's why it's not realistic with today's interest rates. He doesn't really explain shit except taking on more debt. This is a big boy game and if you take on that debt it better be bringing in more money to service that new debt plus some. Average people are watching this thinking they can just buy a bigger house with NO extra income. Sorry to say that's not a good idea.
@@primatrader you're paying the home equity back which is what BOUGHT the second home. you already paid the second home w the home equity line of credit. you buy a car with a loan, that IS the payment and the car doesn't have it's own payment, the loan paid for it and you pay back the loan
Save yourself 16 minutes. Sell your existing home for more than you owe on the loan. The difference is your profit from the equity or the increase in value on your home over the years you’ve lived in it. Use that profit to buy your next home. Just know that the market has likely changed from when you purchased your previous home and you’ll likely get a different interest rate even if you have money to put down. In short, you might be able to afford as much home as you think because home values and interest rates are up. Maybe you’ll get lucky. Cheers!
Remember, you may need to pay federal taxes on home appreciation beyond a certain limit. Also, some states charge the homeowner taxes on the sale of your home.
@@cometcal2i believe anywhere in us you can use a 1031 exchange where as long as you use proceeds to buy equal class asset (another home) there will not be a tax implication
Thank you for this info. I just decided to move back in with my mom for a year to get my finances in tip top while I rent out my first home and hopefully earn a little extra cash before applying for a HELOC. My plan was to take out a HELOC loan either to use for the next house or as a safety net in case I need to make any emergency repairs or cover the mortgage between tenants. I read that if my new property will be my primary residence, the 20% down may not be required, is that correct? If I can still do 3.5% then that gives me hope I can swing only using a portion of the HELOC, depending on the value of my next home, and still being able to keep some as that safety net.
Great explanation! Serious question though, why would I use your company or any other 3rd party company to get a loan of equity when I can just go directly to my mortgage bank that owns the loan and ask?
Hey Megan! Great question! Getting a HELOC can temporarily drop your credit score a bit, typically by about 0-5 points, due to the lender's credit check. Also, having a larger amount of debt can further lower it. However, consistent, on-time payments can help your credit score recover over time. Feel free to check out www.winthehouseyoulove.com/lender if you're ready for pre-qualification or shoot me an email at kyle@winthehouseyoulove.com if you have any other questions. Happy home buying! - Kyle
At 15:00 you mention they can use equity to buy a new home and renters will basically pay for the new home. Here's my question! The first home that you have is not paid for and then you're renting it out, your renters will basically be paying the mortgage on your first house and you will be stuck with paying the note on the 2nd house. I could see the benefit of it ONLY IF RENTERS pay rent for a home that's paid for. Or am I misunderstanding
The benefit of renting out a house is that someone else covers that mortgage. And because of that, when you choose to sell in the future, you get to keep the profit while not having to pay the mortgage to get the profit.
Interest rates are higher on a HELOC than on a 30-year fix. We paid off our 30 mortgage at the 12 year point. We will not get back into an amortization trap ever again. Play safe. Stay debt free and mortgage free even if that means staying put next to neighbor's you do not like.
Bought my home in 2020 for $295K at 3% interest. I currently owe $242K, and it's now valued at around $410K. I would like to buy another house as my primary residence and rent this one out. By taking equity out, does it mean I'll have a higher mortgage on the first house, or would that be a separate loan? Also, my concern is that the interest rate is high, and I'm wondering if I should just wait for it to go down.
Thank you, this is very helpful. My first home rent not only pays for the mortgage, but it also provides me about 1000$ which I can put down toward my new home.
With a home equity loan the current loan won’t be touched in terms of rates. But what will the equity loan rate be based on? Is it based on the current market?
What if rental income from first property doesn’t cover both mortgage and HELOC payments? Do I take that hit until the 2nd rental property starts to cover it?
Good video however what’s the interest rate that you pay on the money you pulled out for your HELOC? Also where are you getting another Loan for 400k and putting 5percent down (20k) nowadays?
Still rocking the ‘stache!! Curious, what are the current rates for a HELOC or Home equity loan? Or is that based on credit scores similar to when buying a home? Didn’t realize how simple it can be, but of course, must plan meticulously. Keep teaching sir!!
Hey there! If you currently don’t have a mortgage, then pull equity out like this video mentioned won’t change. It will work the exact same. Get Pre-Qualified with our team anywhere in the US → www.winthehouseyoulove.com/call
If i am buying a second home from my mom at the remaining balance (giving me over $200k of instant equity and a long term tenant) will I still need a down payment as an investment property?
So I have around $300k equity in my house. Ill probably only be able to pull $240k. Can I take out a heloc to use as a downpayment for a large investment rental income property in another city? That's what Im trying to figure out.
What about repaying the HELOC? Would be nice to include how much repayment would be monthly for this example. HELOC’s sound like free money bc no one mentions you have to pay it back, don’t you?
So i brought land then built a house. Do the same guidelines apply if i was to use the equity to buy maybe 2 investment properties straight up? Or are the rules different when using equity to potentially buy investment properties?
GREAT BC IM WORKING ON MY FICO TO BE OVER 740 BY OCT-DEC TIMEFRAME, WANT TO SELL & THEN BUY IN ANOTHER STATE & I COULDNT FIGURE OUT HOW I WAS GOING TO DO THAT. JUST NEED TO KNOW IF THERE IS A PRE PAYMENT PENALTY ON HELOC
What I don't understand is if the monthly payments from a home equity loan is included in your DTI ratio, what's the difference between using the equity in your current home vs taking out a larger mortgage on a new home.
Equity loans aren’t meant to change your DTI. Using your equity in your current home can be accessed in different ways than taking out a larger mortgage on a new home.
How can I leverage my home? That’s already paid off I have a home that was left to me by my grandparents. They paid the home all when they moved to Indianapolis so how do I leverage that?
You can leverage your paid-off home by either doing a cash-out refinance or getting a HELOC (Home Equity Line of Credit), allowing you to tap into your home's equity for purchasing another property. If you want more personalized guidance on your options, feel free to get pre-qualified with my team at www.winthehouseyoulove.com/lender.
I’ve had this idea, my home is paid off. We’re building our dream on adjoining property we own as soon as my builder is available (could be 1.5 years). Tax appraisal went up $100k this year. Any advantage to using this equity instead of a construction loan to finance any portion we are not paying cash for.? Then just paycheck park to that heloc. Long term rent or even short term rental as a possibility for our old home. I have no interest in a long term mortgage with these rates.
When you get a heloc and it’s just sitting there (meaning you’re not using it yet) Is that included in your dti or will it only be included when you use it for the amount you use?
What if the first home value you bought decrease in its market value. That is you bought it in 300000 dollars and it drops to 250000 dollars, do we still have the Equity.
I own my home outright. I want to move in about 10 months. How easy to get a cash out mortgage? And how many months before I am moving would it be prudent to do this? I want to move and not have pressure to sell/buy within a certain time. When I bought this house, it was contingent on the sale of my other house.. and the pressure was high. I want to move, find something I like at my leisure and availability having the cash available at a moments notice, but not paying high mortgage/interest/insurance/taxes for a very long time. 6 months? 3 months? a month? What do you suggest? Once I find the 'one' I plan to put this one on the market. I live in SWFL and lots of people are moving here so it won't be too difficult to sell.
Hey Luis, I get where you're coming from, but with a HELOC, you have the flexibility to pay more than just the interest, which can help you pay down the balance faster. Plus, HELOCs often have lower rates than credit cards, potentially saving you money over time.
I would like to buy my first investment home. I have built enough equity in my primary home. I have cash too. What would you advise to do to pull some of my equity to pay for down payment and rather invest cash into syndication with 17% annual return or just pay cash for down payment. What would be the wise thing to do ?
Every RUclipsr is saying how to use equity to buy another investment property but nobody isn't mentioning a little detail about pulling the equity of the primary property, will double the monthly payment. In my case from $3,000 to almost $6,000 how am I going to afford that??????
The payment will be based on how much equity you take out. If your payment is doubling, you're taking out an remarkable amount of equity. Most people would just take out enough to finance a down payment on the investment loan. And the investment property is what helps pay down the financing (1st + 2nd mortgage) of said property. If the financing for an investment property is higher than the return of the investment property, it really isn't a good investment property.
Another way to do it is use a home equity partnership. Companies like home tap and point for example, utilize a method where there’s no cost to access the equity.
This is why buying a home is a liability because releasing equity will impact your monthly mortgage payment. Do this on investment property and have tenants pay the extra mortgage payments. Obviously, ensure rent does cover the extra mortgage payment
Equity is more of a concept rather than money in an account somewhere. For instance, if your loan balance is $150,000 and someone buys your house for $200,000 you have $50,000 in equity. It's just the difference between the two. So when you sell, you'll get $50,000. The seller will not get anything. They will simply get the house they paid for.
1. Banks always reduce market equity. 2. Now got 2 property tax payments for both homes. If u live in 5 most popular states or new SouthEastern tech states,= big cash bill.
1. Pulling equity = loan 2. Using pulled equity as downpayment = another property loan So if im using cash out for downpayment on second property it means i imidately enter 2 loans ? How my cashflow will cover that? What about vacancy? It happens more offten that people talk about on YT It can kill previous Cashflow or even worse ( vacancy)
You're correct; pulling equity means taking a loan, and using that equity as a down payment means you'll have two loans. Managing cash flow and planning for vacancies are crucial-it's wise to have a financial cushion to cover those gaps. Thanks for watching!
I have a paid for home in which I live in. I have a 2nd home in which I rent out. I was thinking of obtaining a heloc to use for a down payment on a long term rental. I understand the variability of the heloc but I essentially have no debt so I’d be willing to pay the heloc long term or until my rental property cash flows to pay it. I think the opportunity of owning another property outweighs the risk of the heloc I’m also in the medical field have been at the same job for 20 years and make over 6 figures. In my situation do you think the heloc for long term rental is a good idea?
Thanks so much for watching and for the kind words! If you have any questions or need help with your home buying journey, feel free to reach out anytime.
I have 2 homes, paid off with no loans. Own a remodel company and getting older and would like to buy investment property. Easily a million in equity but scared of debt.
It's great that you have such strong equity and no current debt! To ease your concerns, consider leveraging a home equity line of credit (HELOC) or cash-out refinance to maintain liquidity while investing. If you want more personalized advice or to explore financing options, you can connect with us at www.winthehouseyoulove.com/lender.
I inherited some money and used most of it to buy a house. It's A big property and house. My first house. I don't have much money left. Also having trouble getting a job. I realize now that I hate owning a house. I want to upgrade to a condo and sell this damn thing. Less headache and probably cheaper. I'm hoping this video will help me do such a thing.
I'm sorry to hear you're feeling frustrated with homeownership. Selling your current home and using the equity to buy a condo is a great option-just make sure to get a good estimate on your property's value and factor in closing costs and any needed repairs.
Hi. May I know what software you are using that enables you to record a video of yourself while sharing what you write on your notes real time? Thanks!
Hey Angel! I use Ecamm. And if you're ready to start on a pre-approval, head over to www.winthehouseyoulove.com/lender or you can reach me at kyle@winthehouseyoulove.com. Cheers! -Kyle
You'd only need to do this if for timing reasons you needed to buy before selling and you didn’t have cash to put money down on the new home. If you have any questions please email me at kyle@winthehouseyoulove.com
Can you keep the payment around the same if you are going back to a 30 year loan?? I have 120k in equity and have 77k left to pay over a 12 year period. I lived in the house for 18 years. I want to take that and buy a rental… is this even an option?
Yes, you can take out a home equity loan while selling your current home and then use those proceeds as a cash offer on a new home. It's important to time everything carefully and communicate with your lender and real estate agent to ensure everything aligns smoothly.
I've completely paid off my home.. and I would like to borrow against it to buy my next house.. having no existing mortgage will I have to do anything different?
I heard on another channel that you cannot use 75% of rental income towards your 2nd home if it will be owner occupied…you can only use that income if you are getting an investment property as your 2nd home ..is this information correct ? I was a little confused because I do want to move out of my primary and rent it out and buy and occupy the 2nd home. Just trying to figure out my DTI …great information btw thank you!
You can use rental income from a residence you’re departing if you have a signed lease agreement showing the rental income. You can use 75% of the lease income per Fannie guidelines
I own 15 acres with two fixer homes on prime class 1 soil and an irrigation system, all free and clear. How do I get money from my equity? Is selling the only way?
You can tap into your property's equity by taking out a cash-out refinance loan or a home equity line of credit (HELOC). Speak with a mortgage lender to explore which option best fits your financial goals and property type.
I was just wondering about this exact topic, and this was so helpful! Would you be able to make another video discussing using equity to pay down things like student loans? Like what are the pros and cons of doing that? Thanks!!
Can i get a Heloc, sell my house and use VA loan to. purchase another home? I know with Va loan you don't need a down payment but i would like to put money down to make the mortgage affordable.
You mentioned in the beginning "not having to refi into a higher interest rate" then it occurred to me you're talking about your current home. The fact of the matter is a HELOC for example is quite expensive right now so the interest you'll be paying on the money you're borrowing from your home equity will be higher than even the crazy high rates ATM. Please prove me wrong. I'd love to hear of perhaps a new loan program I'm not aware about
If you had a $250k loan on a $500k house at 3% and want $50k. It would be better to get a HELOC for $50,000 at 7% than refinance everything ($300k) at 7%.
Got it!! However, if I rent out my current home and use the Heloc to buy the second home, how should I finance the second home to not lose the Heloc? I believe you have to keep the first house as a “residential” to keep the Heloc open?? I don’t want to jeopardize losing my heloc. But would love to rent it out
Thank you so much..been racking my mind about whether or not a heloc is a good option for me... i think once i bring my credit score up im definitely going to explore it..Would you recommend going through a commercial bank or through my current mortgage provider?
Hey there, glad you're finding the info useful! Both a commercial bank and your current mortgage provider can be great options for a HELOC, as it really comes down to who offers you the best terms. It's always a good idea to check out several different places and pick the one that makes the most sense for you.
Thanks so much for the support! If you're interested in exploring your options further, feel free to reach out or check out resources at www.winthehouseyoulove.com.
If your mortgage is paid off, you can use a cash-out refinance or a home equity line of credit (HELOC) to access your equity for purchasing another property.
So... Tell me if I am doing this right... Value now is 265k and our remaining loan is 104k.... Even though when we purchase it was only values at like 120k... That means we have 161k in equity??
Hey Nicole, you've got it right! The difference between your current home value ($265k) and your remaining loan balance ($104k) is indeed your home equity. So, you're sitting on about $161k in equity. Great job in building that up! 🎉 If you're looking to use that equity or want to explore your options further, feel free to start on a pre-qualification at www.winthehouseyoulove.com/lender or shoot me an email at kyle@winthehouseyoulove.com. Cheers! - Kyle
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DUDE. This video is AMAZING. So friggin straight forward and no rambling and extra garbage. Thank you!
Thank you!
This is the best video I have seen on how to leverage your current equity to buy another home or investment property. Straight forward, easy to follow, and extremely understandable. Walked away feeling more knowledgable on potential nexts to consider when expanding our real estate portfolio. Thank you!
I'm so glad to hear!! Thanks so much!
Nice to see someone helping but also making sure the information is easy to understand!
Thanks a ton for the kind words! If you have any questions or need further help, feel free to reach out.
Thank you! Good video. The visuals, slower explanation, and the detail…good job
Hey there! Thank you so much for your kind words and support! I'm really glad you enjoyed the video. It's great to hear that the visuals, slower explanation, and detail resonated with you. If you're ready to take the next step and start on a pre-qualification, you can head over to www.winthehouseyoulove.com. Thanks again!
Using credit (including a HELOC) as part of your down payment can have some gotchas. Many lenders will want a "seasoning" period between the time you take money out of a HELOC and when you are being approved for a mortgage on the new property. 3 months is a common seasoning period.
Also keep in mind that your HELOC will likely be treated like a credit card on your credit report and credit score. That means that if you withdraw more than 30% of your HELOC limit, that can have a substantially negative impact on your credit score, which can make it harder to qualify for a new mortgage or get good terms on a new mortgage.
You're absolutely right, Eugene! Seasoning periods and high HELOC balances can indeed impact your mortgage approval and credit score. Always wise to plan ahead and ensure your finances are in optimal shape before applying. Thanks for watching!
This helped so much. Finally someone explained it step by step. I have enough equity to move primary residences with a HELOC. Thank you.
Glad to help!
This is exactly the video I need. Plan to move in 2 years. My home has about 100K in equity ( so they say,fingers crossed). Right now my dti is high. Doing gig jobs to lower that debt to qualify for a heloc to knock out more debt before buying another home. Maybe. I need advice.
Hi there, check out Christi Vann for velocity banking...brilliant channel on reducing debt🙏❤
Wow you are great. You take time to explain and show everything step by step like a good teacher. Thank you.
Thank you so much for your kind words! I'm thrilled to hear that you found the video helpful. If you need further assistance or have questions about using equity, feel free to reach out!
5% down payment is crazy to me, I guess I need to look harder in my area. 5% down vs. 20% down makes a huge difference in whether the deal will work or not. Great video around the general concept. Thanks.
FHA or VA Loan
Do you have a video explaining the repayment ? Is it added to your second mortgage or would you have three separate payments?
This is what I want to know, So basically you have 3 loans to pay...First home, Second home, and Home Equity?
@@primatrader And that's why it's not realistic with today's interest rates. He doesn't really explain shit except taking on more debt. This is a big boy game and if you take on that debt it better be bringing in more money to service that new debt plus some. Average people are watching this thinking they can just buy a bigger house with NO extra income. Sorry to say that's not a good idea.
@@primatrader you're paying the home equity back which is what BOUGHT the second home. you already paid the second home w the home equity line of credit. you buy a car with a loan, that IS the payment and the car doesn't have it's own payment, the loan paid for it and you pay back the loan
Save yourself 16 minutes. Sell your existing home for more than you owe on the loan. The difference is your profit from the equity or the increase in value on your home over the years you’ve lived in it. Use that profit to buy your next home. Just know that the market has likely changed from when you purchased your previous home and you’ll likely get a different interest rate even if you have money to put down. In short, you might be able to afford as much home as you think because home values and interest rates are up. Maybe you’ll get lucky. Cheers!
Keep the first home 🏠 get the equity get another home use the first home as passive income
Remember, you may need to pay federal taxes on home appreciation beyond a certain limit. Also, some states charge the homeowner taxes on the sale of your home.
I rather have a paid off home then a nicer one "new" home with a payment. Period
Thank you 😊
@@cometcal2i believe anywhere in us you can use a 1031 exchange where as long as you use proceeds to buy equal class asset (another home) there will not be a tax implication
Here in California, an appraisal is recorded at the county and triggers an increase in property taxes.
Oof that’s rough, but makes sense! Property taxes can definitely add up, especially in states like California. Thanks for watching!
Thank you for this info. I just decided to move back in with my mom for a year to get my finances in tip top while I rent out my first home and hopefully earn a little extra cash before applying for a HELOC. My plan was to take out a HELOC loan either to use for the next house or as a safety net in case I need to make any emergency repairs or cover the mortgage between tenants. I read that if my new property will be my primary residence, the 20% down may not be required, is that correct? If I can still do 3.5% then that gives me hope I can swing only using a portion of the HELOC, depending on the value of my next home, and still being able to keep some as that safety net.
Another important point not covered in this video is that with a Refi Cash-out you can expect to pay closing cost for the new mortgage.
Thanks for the addition!
Usually it’s a few thousands dollars and they also can roll those re-fi closing costs into the cash out loan.
So do you have to pay off two loans at once with a home equity loan / HELOC?
I believe the equity gets added to your original mortgage
Very informative. You were clear in your explanations and examples. Thank you!
Glad it was helpful! Thanks for watching.
@@WinTheHouseYouLove sir, does that mean you won't profit as much when you decide to s3ll your first home? Since you pulled 80% of your equity out?
Great explanation! Serious question though, why would I use your company or any other 3rd party company to get a loan of equity when I can just go directly to my mortgage bank that owns the loan and ask?
How much of a hit does your credit score take after taking out a HELOC to buy a new home?
Hey Megan! Great question! Getting a HELOC can temporarily drop your credit score a bit, typically by about 0-5 points, due to the lender's credit check. Also, having a larger amount of debt can further lower it. However, consistent, on-time payments can help your credit score recover over time. Feel free to check out www.winthehouseyoulove.com/lender if you're ready for pre-qualification or shoot me an email at kyle@winthehouseyoulove.com if you have any other questions. Happy home buying! - Kyle
At 15:00 you mention they can use equity to buy a new home and renters will basically pay for the new home.
Here's my question! The first home that you have is not paid for and then you're renting it out, your renters will basically be paying the mortgage on your first house and you will be stuck with paying the note on the 2nd house.
I could see the benefit of it ONLY IF RENTERS pay rent for a home that's paid for. Or am I misunderstanding
The benefit of renting out a house is that someone else covers that mortgage. And because of that, when you choose to sell in the future, you get to keep the profit while not having to pay the mortgage to get the profit.
Thank you. What do you suggest if you own the home outright and want to use the "equity" to buy a second home? Thank you.
Interest rates are higher on a HELOC than on a 30-year fix. We paid off our 30 mortgage at the 12 year point. We will not get back into an amortization trap ever again. Play safe. Stay debt free and mortgage free even if that means staying put next to neighbor's you do not like.
Bought my home in 2020 for $295K at 3% interest. I currently owe $242K, and it's now valued at around $410K. I would like to buy another house as my primary residence and rent this one out. By taking equity out, does it mean I'll have a higher mortgage on the first house, or would that be a separate loan? Also, my concern is that the interest rate is high, and I'm wondering if I should just wait for it to go down.
It would be a higher mortgage because you increasing the mortgage loan to receive money
Thank you, this is very helpful. My first home rent not only pays for the mortgage, but it also provides me about 1000$ which I can put down toward my new home.
oh ,almost same like you but how you can put down toward my new home.?
I understand that, but what is the interest a month on that helloc??? Is that per month? Also does it stop till you pay that back the helloc.
With a home equity loan the current loan won’t be touched in terms of rates. But what will the equity loan rate be based on? Is it based on the current market?
I feel like you made this video just for me 😊 right up my alley.
Woah! Thanks for watching and best of luck!
Excellent video!
Do you have any info on your studio setup? I'd love to know about your audio, camera, and screen capture software. The quality is very good.
Thanks, Adam! I use a Sony A7RIII for the camera, a Neumann TLM 102 for audio, and Ecamm for screen capture software-so glad you like the quality!
@WinTheHouseYouLove what lens are you rocking?
Sigma 35m 1.4 art
Can you provide estimate of interest rate for HELOCs and other methods mentioned? thanks
Good Educational Content
If I need to take some money out to do renovations to the house then buy another is that possible?
Yes, it's possible! You can do a cash-out refinance to get funds for renovations, then use the increased equity to help buy another home.
What if rental income from first property doesn’t cover both mortgage and HELOC payments? Do I take that hit until the 2nd rental property starts to cover it?
Great Video . Great Info. Learned some new today. Thank you !!!
Nice! Thanks for watching. :)
Good video however what’s the interest rate that you pay on the money you pulled out for your HELOC? Also where are you getting another Loan for 400k and putting 5percent down (20k) nowadays?
Still rocking the ‘stache!! Curious, what are the current rates for a HELOC or Home equity loan? Or is that based on credit scores similar to when buying a home? Didn’t realize how simple it can be, but of course, must plan meticulously. Keep teaching sir!!
I think the percentage stand at "rip your arse" right about now.
Can you explain if you own the home without mortgage.
Hey there! If you currently don’t have a mortgage, then pull equity out like this video mentioned won’t change. It will work the exact same.
Get Pre-Qualified with our team anywhere in the US → www.winthehouseyoulove.com/call
What is the monthly payment based on with the HELOC?
It’s based on the outstanding balance and the current interest rate. It can vary as you borrow more or if the rate changes
If i am buying a second home from my mom at the remaining balance (giving me over $200k of instant equity and a long term tenant) will I still need a down payment as an investment property?
So I have around $300k equity in my house. Ill probably only be able to pull $240k. Can I take out a heloc to use as a downpayment for a large investment rental income property in another city? That's what Im trying to figure out.
What about repaying the HELOC? Would be nice to include how much repayment would be monthly for this example. HELOC’s sound like free money bc no one mentions you have to pay it back, don’t you?
All loans have to be paid back by definition of the word :)
Can I do a heloc in TX to buy in WV
So i brought land then built a house. Do the same guidelines apply if i was to use the equity to buy maybe 2 investment properties straight up? Or are the rules different when using equity to potentially buy investment properties?
GREAT BC IM WORKING ON MY FICO TO BE OVER 740 BY OCT-DEC TIMEFRAME, WANT TO SELL & THEN BUY IN ANOTHER STATE & I COULDNT FIGURE OUT HOW I WAS GOING TO DO THAT. JUST NEED TO KNOW IF THERE IS A PRE PAYMENT PENALTY ON HELOC
What I don't understand is if the monthly payments from a home equity loan is included in your DTI ratio, what's the difference between using the equity in your current home vs taking out a larger mortgage on a new home.
Equity loans aren’t meant to change your DTI. Using your equity in your current home can be accessed in different ways than taking out a larger mortgage on a new home.
How can I leverage my home? That’s already paid off I have a home that was left to me by my grandparents. They paid the home all when they moved to Indianapolis so how do I leverage that?
You can leverage your paid-off home by either doing a cash-out refinance or getting a HELOC (Home Equity Line of Credit), allowing you to tap into your home's equity for purchasing another property. If you want more personalized guidance on your options, feel free to get pre-qualified with my team at www.winthehouseyoulove.com/lender.
Perfectly explained 👌
Very easy to understand and great examples.. will be calling soon
Thanks for watching!
So if I own my house will this be easier ? Really wanting to take the step to get a loan on my house and buy another home to have someone rent it out
Do you have to be living in the home? The home that I need the HELOC or cash out one is an inherited house.
I don’t think so but I do think it will be taxed differently because it’s not your primary residence
I’ve had this idea, my home is paid off. We’re building our dream on adjoining property we own as soon as my builder is available (could be 1.5 years). Tax appraisal went up $100k this year. Any advantage to using this equity instead of a construction loan to finance any portion we are not paying cash for.? Then just paycheck park to that heloc. Long term rent or even short term rental as a possibility for our old home. I have no interest in a long term mortgage with these rates.
What did ya end up doing? We are in this exact situation.
@@Grown-N-Nosey still waiting the builder. I’m interested in an All in One Loan mortgage currently
Where can we get the home Equity loan
Talk to your local bank
When you get a heloc and it’s just sitting there (meaning you’re not using it yet) Is that included in your dti or will it only be included when you use it for the amount you use?
A HELOC is only included in your DTI calculations once you start using it because that's when you have a payment obligation
What if the first home value you bought decrease in its market value. That is you bought it in 300000 dollars and it drops to 250000 dollars, do we still have the Equity.
Equity is the difference between the market value of your home and what you still owe on your mortgage
Fantastic Info, Thank you!!!!! ❤❤❤❤
Thanks for watching! :)
I have to pay back the home equity loan ?
Yes
I own my home outright. I want to move in about 10 months. How easy to get a cash out mortgage? And how many months before I am moving would it be prudent to do this? I want to move and not have pressure to sell/buy within a certain time. When I bought this house, it was contingent on the sale of my other house.. and the pressure was high. I want to move, find something I like at my leisure and availability having the cash available at a moments notice, but not paying high mortgage/interest/insurance/taxes for a very long time. 6 months? 3 months? a month? What do you suggest? Once I find the 'one' I plan to put this one on the market. I live in SWFL and lots of people are moving here so it won't be too difficult to sell.
But why would you do a heloc to pay off credit cards or a car if you only pay interests on it?
Hey Luis, I get where you're coming from, but with a HELOC, you have the flexibility to pay more than just the interest, which can help you pay down the balance faster. Plus, HELOCs often have lower rates than credit cards, potentially saving you money over time.
I would like to buy my first investment home. I have built enough equity in my primary home. I have cash too. What would you advise to do to pull some of my equity to pay for down payment and rather invest cash into syndication with 17% annual return or just pay cash for down payment. What would be the wise thing to do ?
Great question! Paying cash is usually the easiest option
Every RUclipsr is saying how to use equity to buy another investment property but nobody isn't mentioning a little detail about pulling the equity of the primary property, will double the monthly payment. In my case from $3,000 to almost $6,000 how am I going to afford that??????
The payment will be based on how much equity you take out. If your payment is doubling, you're taking out an remarkable amount of equity. Most people would just take out enough to finance a down payment on the investment loan. And the investment property is what helps pay down the financing (1st + 2nd mortgage) of said property.
If the financing for an investment property is higher than the return of the investment property, it really isn't a good investment property.
Another way to do it is use a home equity partnership. Companies like home tap and point for example, utilize a method where there’s no cost to access the equity.
There are other details that are involved, but that’s just a quick example
How about your income from the investment you use the money for?
This is why buying a home is a liability because releasing equity will impact your monthly mortgage payment. Do this on investment property and have tenants pay the extra mortgage payments. Obviously, ensure rent does cover the extra mortgage payment
Thank you for being so thorough!
Hey with the home equity loan when it says lump sum everything comes at once ?
Can the equity transfer to the new owner of the home once it's purchased or does the equity reset once a new owner purchases the home?
Equity is more of a concept rather than money in an account somewhere.
For instance, if your loan balance is $150,000 and someone buys your house for $200,000 you have $50,000 in equity. It's just the difference between the two. So when you sell, you'll get $50,000. The seller will not get anything. They will simply get the house they paid for.
1. Banks always reduce market equity. 2. Now got 2 property tax payments for both homes. If u live in 5 most popular states or new SouthEastern tech states,= big cash bill.
It's definitely tough managing property taxes and banks being conservative with equity calculations. Thanks for sharing your thoughts!
What about HELOC’s in Texas?
1. Pulling equity = loan
2. Using pulled equity as downpayment = another property loan
So if im using cash out for downpayment on second property it means i imidately enter 2 loans ?
How my cashflow will cover that?
What about vacancy? It happens more offten that people talk about on YT
It can kill previous Cashflow or even worse ( vacancy)
You're correct; pulling equity means taking a loan, and using that equity as a down payment means you'll have two loans. Managing cash flow and planning for vacancies are crucial-it's wise to have a financial cushion to cover those gaps. Thanks for watching!
I have a paid for home in which I live in. I have a 2nd home in which I rent out. I was thinking of obtaining a heloc to use for a down payment on a long term rental. I understand the variability of the heloc but I essentially have no debt so I’d be willing to pay the heloc long term or until my rental property cash flows to pay it. I think the opportunity of owning another property outweighs the risk of the heloc I’m also in the medical field have been at the same job for 20 years and make over 6 figures. In my situation do you think the heloc for long term rental is a good idea?
This sounds risky.. but i am looking to doing this since my fsmily got bigger. But i dont want to sell but it seems easier to sell
Best of luck and thanks for watching, :)
Honestly great video
Thanks so much for watching and for the kind words! If you have any questions or need help with your home buying journey, feel free to reach out anytime.
I have 2 homes, paid off with no loans. Own a remodel company and getting older and would like to buy investment property. Easily a million in equity but scared of debt.
It's great that you have such strong equity and no current debt! To ease your concerns, consider leveraging a home equity line of credit (HELOC) or cash-out refinance to maintain liquidity while investing. If you want more personalized advice or to explore financing options, you can connect with us at www.winthehouseyoulove.com/lender.
Very informative!
Thank you so much!
v helpful. Thank you!
I inherited some money and used most of it to buy a house. It's A big property and house. My first house. I don't have much money left. Also having trouble getting a job.
I realize now that I hate owning a house. I want to upgrade to a condo and sell this damn thing.
Less headache and probably cheaper. I'm hoping this video will help me do such a thing.
I'm sorry to hear you're feeling frustrated with homeownership. Selling your current home and using the equity to buy a condo is a great option-just make sure to get a good estimate on your property's value and factor in closing costs and any needed repairs.
Hi. May I know what software you are using that enables you to record a video of yourself while sharing what you write on your notes real time? Thanks!
Hey Angel! I use Ecamm. And if you're ready to start on a pre-approval, head over to www.winthehouseyoulove.com/lender or you can reach me at kyle@winthehouseyoulove.com. Cheers! -Kyle
Why would you pull out the equity if you're selling? Seems to only be necessary if you're keeping both homes or renting out the old home?
You'd only need to do this if for timing reasons you needed to buy before selling and you didn’t have cash to put money down on the new home.
If you have any questions please email me at kyle@winthehouseyoulove.com
Can you keep the payment around the same if you are going back to a 30 year loan?? I have 120k in equity and have 77k left to pay over a 12 year period. I lived in the house for 18 years. I want to take that and buy a rental… is this even an option?
why not also talk about "Home Equity Agreement" ?
I can’t cover everything in one video
Who do you speak to get the money out?
Can you get equity loan...then buy your house contingent upon selling your house your living in then use that money as cash offer.
Yes, you can take out a home equity loan while selling your current home and then use those proceeds as a cash offer on a new home. It's important to time everything carefully and communicate with your lender and real estate agent to ensure everything aligns smoothly.
Our home is paid in full. Would this still be a wise decision?
Great info!
I recorded a personal video for you: vid.us/htfltn
I've completely paid off my home.. and I would like to borrow against it to buy my next house.. having no existing mortgage will I have to do anything different?
Nope, you can take advantage of these programs
Omg thank you so much I understand so much better
Thank you so freakin much for explaining this. Very informative and loved the details your gave.
Thank you so much for watching!! :)
I heard on another channel that you cannot use 75% of rental income towards your 2nd home if it will be owner occupied…you can only use that income if you are getting an investment property as your 2nd home ..is this information correct ? I was a little confused because I do want to move out of my primary and rent it out and buy and occupy the 2nd home. Just trying to figure out my DTI …great information btw thank you!
You can use rental income from a residence you’re departing if you have a signed lease agreement showing the rental income. You can use 75% of the lease income per Fannie guidelines
Thanks for video!
My pleasure!
I own 15 acres with two fixer homes on prime class 1 soil and an irrigation system, all free and clear. How do I get money from my equity? Is selling the only way?
Look up HELOC I don't think I'd be able to explain very well
You can tap into your property's equity by taking out a cash-out refinance loan or a home equity line of credit (HELOC). Speak with a mortgage lender to explore which option best fits your financial goals and property type.
I was just wondering about this exact topic, and this was so helpful! Would you be able to make another video discussing using equity to pay down things like student loans? Like what are the pros and cons of doing that? Thanks!!
Why would you take out a 8% loan to pay down what i am sure is a much cheaper % loan?
Can i get a Heloc, sell my house and use VA loan to. purchase another home? I know with Va loan you don't need a down payment but i would like to put money down to make the mortgage affordable.
Yes you can
You mentioned in the beginning "not having to refi into a higher interest rate" then it occurred to me you're talking about your current home. The fact of the matter is a HELOC for example is quite expensive right now so the interest you'll be paying on the money you're borrowing from your home equity will be higher than even the crazy high rates ATM. Please prove me wrong. I'd love to hear of perhaps a new loan program I'm not aware about
If you had a $250k loan on a $500k house at 3% and want $50k. It would be better to get a HELOC for $50,000 at 7% than refinance everything ($300k) at 7%.
Great video
Thanks!
Great video. Is there closing coast in a home equity loan?
Yes
Are there any advantages to your income tax by using a HELOC? Like write-offs?
Thank you for posting! Your explanation was clear and easy to understand.
Got it!! However, if I rent out my current home and use the Heloc to buy the second home, how should I finance the second home to not lose the Heloc?
I believe you have to keep the first house as a “residential” to keep the Heloc open??
I don’t want to jeopardize losing my heloc. But would love to rent it out
I bought a house cash can i still do this?
Absolutely, you can access your equity by considering a cash-out refinance or a home equity line of credit (HELOC).
Please note $350,000 x 85% is $297,500 leaving $97,500 for the 2nd lien avail
Small typo
Very informative, thank you
Glad it was helpful!
Thank you so much..been racking my mind about whether or not a heloc is a good option for me... i think once i bring my credit score up im definitely going to explore it..Would you recommend going through a commercial bank or through my current mortgage provider?
Hey there, glad you're finding the info useful! Both a commercial bank and your current mortgage provider can be great options for a HELOC, as it really comes down to who offers you the best terms. It's always a good idea to check out several different places and pick the one that makes the most sense for you.
Credit unions are the best
Give this man a like
Thanks so much for the support! If you're interested in exploring your options further, feel free to reach out or check out resources at www.winthehouseyoulove.com.
What if the mortgage is paid off?
And refinancing on 6% is still better than double digits
If your mortgage is paid off, you can use a cash-out refinance or a home equity line of credit (HELOC) to access your equity for purchasing another property.
How can I contact you privatly? I need your help.
kyle@winthehouseyoulove.com
So... Tell me if I am doing this right... Value now is 265k and our remaining loan is 104k.... Even though when we purchase it was only values at like 120k... That means we have 161k in equity??
Hey Nicole, you've got it right! The difference between your current home value ($265k) and your remaining loan balance ($104k) is indeed your home equity. So, you're sitting on about $161k in equity. Great job in building that up! 🎉 If you're looking to use that equity or want to explore your options further, feel free to start on a pre-qualification at www.winthehouseyoulove.com/lender or shoot me an email at kyle@winthehouseyoulove.com. Cheers! - Kyle