My wife and I have a condo paid off, and want to buy a house and rent out the condo (due to a bunch of condo construction recently in my area, nobody seems interested in buying it).
We need to borrow money for a down payment on a house. My wife just got offered a job out of town, we are moving, it is a good time to buy for us even though we don't have much saved up. I figured I could use a HELOC. I was wrong. My local credit union says that due to federal regulations, I can't use a condo to back a HELOC, only an actual house. Well SHIT.
There is this thing called a residential equity loan, the banker says, but the IR is almost 7% (screw that!), and the origination fees are ridiculous (appx $3,000 for a measely $40k loan.
Any advice fellow mustachians?
Update: My lawyer friend says it is because the HOA owns the land on which my condo sits.