Author Topic: Wells Fargo will give you an equity line on a rental property  (Read 12697 times)

clarkfan1979

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Based on recommendations from biggerpockets, I called Wells Fargo today asking for a line of credit on two rental properties. They do it and their rate is prime (4%) + 1.63%. You can get a discount if you open a wells fargo account. They let you borrow 60% loan to value on rentals. You must own the property for more than 1 year.


jmr5x

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #1 on: May 24, 2017, 01:08:41 AM »
So they will let you borrow 60% of the loan you have on the house currently or 60% of value of home regardless of mortgage?

Timmm

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #2 on: May 26, 2017, 06:42:42 PM »
Great tip, clarkfan! That's pretty expensive money, but as long as it's no/low cost otherwise, a nice option to make available.

jmr5x, I would strongly assume that the 60% is for total Loan To Value. So: (1st mortgage + LOC) / Value = .6 max. If you have a $100k property with a $45k mortgage balance, you'd qualify for a $15k loc.

That's a lot lower (and again, more expensive) than for most owner-occupied options, but as I just posted in another thread, I haven't seen any HELOC option at all on rentals for years.

chasesfish

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #3 on: May 27, 2017, 11:53:08 AM »
Geesh, I haven't seen those since 2006-2007.  Equity lines on rental properties...

Dicey

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #4 on: May 27, 2017, 12:29:02 PM »
Geesh, I haven't seen those since 2006-2007.  Equity lines on rental properties...
Makes "sense", I guess. Housing prices in the Bay Area are exceeding peak 2006 levels and Wells Fargo's reputation is in the toilet. A match made in heaven?

Milspecstache

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #5 on: May 28, 2017, 03:25:48 PM »
In the process of getting a HELOC on an investment duplex.  Not going so well.  Wells Fargo wants every document in the universe (repeatedly, too) and I've tried to explain 1031 exchange 4 times now, to no avail.  Last Friday they asked me to send the checking account statement to show the 1031 payout...

Very disgusted with the company as I asked for the loan over 2 months ago.  Just about ready to tell them to forget about it.

Btw I'm only asking now for about $40k on a rental I just bought (loan-free) for $115k.  I have awesome credit and very little other debt.  I just happen to love HELOCs to avoid all the underwriting fees that normally get charged and the freedom to move money quickly.  No one else will do a HELOC on investment duplexes.

monarda

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #6 on: May 29, 2017, 12:19:48 PM »
Milspec,

You own this place with no loan? Why not just do a conventional cash-out refinance?
I'd stay far away from Wells Fargo
I only have loans at local banks and credit unions, who promise not to sell them (to giants like these)

Milspecstache

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Re: Wells Fargo will give you an equity line on a rental property
« Reply #7 on: May 29, 2017, 05:00:49 PM »
I cash flow about $5k a month so I love HELOCs in the ability to move money quickly and minimize closing costs, interest, and other fees.

If I close this week and don't need the Wells Fargo loan I will probably cancel.  I generally use a local bank or two but they won't touch an investment duplex for HELOC.