Home Equity Loans on Investment Properties: Everything You Need to Know
Home equity loans are a popular way to access the equity you have built in your home. But did you know that you can also use a home equity loan on an investment property ? This can be a smart way to finance renovations, repairs, or even the purchase of a new investment property. In this blog, we will discuss the pros and cons of home equity loans. We will also delve into how to plan carefully before investing in a home equity loan. What is a Home Equity Loan? A home equity loan is a type of loan that allows you to borrow money against the equity you have in your home. The amount you can borrow is typically based on the value of your home and the amount you owe on your mortgage. How does a Home Equity Loan Work on an Investment Property? The process of getting home equity on an investment property is similar to getting one for your primary residence. “According to Bank of America , lenders base their loan-to-value ratio ( LTV ) on your home equity. If your LTV is greater th...
