Need some creative home equity ideas

[Dividend Bro]

I am looking to do a  BRRRR deal (as coined over at BiggerPockets)  where my cash for a deal is upfront. I'd like to avoid private lending right now and I only need maybe $60k. I own a house outright that I inherited worth $200k but it is not my primary residence. Some of my family lives there.


I am trying to get a HELOC on it but since it is not an "investment property", second home or vacation home, lenders are confused and won't commit to anything. I feel like I need to use the equity sitting there somehow. Any ideas on other loans I could look into to get around this?

[arebelspy]

since it is not an "investment property", second home or vacation home, lenders are confused and won't commit to anything.

How is it not a second home?  You're the one who owns it, yeah?  It's a second home you're letting some relatives live in, as caretakers.

[Dividend Bro]

It is the only property I own. I rent in a different city. From what I'm reading a second home implies that you have a principal residence.

[arebelspy]

Ah. How about vacation home?  Does you ever travel and stay there?

"A dwelling other than the owner's primary residence that is used for recreational purposes, like vacations"

It's not your primary, if you ever travel there to visit that family, for example, I could see the case for it being a vacation home.

[Dividend Bro]

Hmm maybe.. I just don't know if not having a principal residence has anything to do with it. I suppose by IRS rules I could call it a second home, not sure about lenders. Would hate to be suspected of mortgage fraud and have my loan called in early. There must be other people out there in a similar situation.

[Dancin'Dog]

Did you ask over on Bigger Pockets?

Seems like the bankers would tell you what they'd like you to call it.   

[Lmoot]

Does your family living there pay you anything? If so, then it is an investment property. It's best you define it to yourself clearly and go in with clarity; brokers don't like uncertainty as you've learned. Yes and no answers only, no "not really's" or "kind of" "not exactly". It sounds like you could swing it as an investment property.

[fishnfool]

When I spoke with a Wells Fargo mortgage rep recently he said I only needed to stay at another home 10 days per year to qualify as a second home.