I have some equity in my house that's not doing much. I was thinking about using the HELOC for real estate investing... mainly placing all cash offers to close quickly and hopefully obtain steep discounts or instant equity. My local bank is offering a HELOC at the terms listed below. Anyone have thoughts on this approach? Also does anyone know of a better HELOC option with another bank?
200k HELOC Option A Option B
Upfront Fees: $1,413.60 $0
12 Month Promotional Rate: 2.24% (prime – 1.51%) 2.49%(prime -1.26%)
Payment first 12 months
(assuming use of $200,000) $373.33 $415
Permanent Rate after 1st year: 3.75% (Prime +0%) 4% (Prime +0.25%)
Payment $625 $666.70
200k HELOC Option A Option B
Upfront Fees: $1,413.60 $0
12 Month Promotional Rate: 2.24% (prime – 1.51%) 2.49%(prime -1.26%)
Payment first 12 months
(assuming use of $200,000) $373.33 $415
Permanent Rate after 1st year: 3.75% (Prime +0%) 4% (Prime +0.25%)
Payment $625 $666.70
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