Clayton Morris Shares: Best Tips for Using a HELOC in 2024 | Morris Invest

The HELOC is a great financial tool you can use to reach a variety of financial goals, whether you want to pay off high interest debt, invest in real estate, or pay down the principal balance of your primary residence. In this video, I'm sharing my best tips for using a HELOC in 2024!

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How much can I borrow with a HELOC?
Most banks will allow you to access up to 85% of your available equity, but this can vary based on your lender and your personal finances
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How does the interest rate work on a HELOC?
The home equity line of credit works differently than most financial products because it has a draw period and a repayment period. Here’s how it works: the draw period is usually 5-10 years. During this time, you only have to make payments on the interest. Then when the repayment period kicks in, you’re required to pay both interest and principal payments. The repayment period typically lasts 20 years.
Another thing that is different about the HELOC is that it has a variable interest rate. So unlike your mortgage, you aren’t locked into a certain rate. As baseline rates adjust, just like we’ve seen over the past few years, the HELOC’s interest rate will go up or down.
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Where can I find a HELOC?
The best place to start is at your local rates and credit unions. Let me tell you why: these smaller institutions can usually offer the most favorable rates and terms. The other thing to consider is that different states have different laws, so staying local is going to be your safest bet.
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What can I use the funds for?
There are really no restrictions on what you can use a HELOC for. I wouldn’t advise using it to buy liabilities, but it may be financially intelligent to use the funds to buy performing assets, make improvements to your home, or pay down higher interest debt.
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How does a HELOC differ from a cash-out refinance?
A HELOC is sometimes referred to as a second mortgage, meaning it’s an additional product. A cash-out refinance, however, replaces your existing mortgage. Although the HELOC and the cash-out refinance serve a similar purpose, they’re two totally different financial products with different rates and terms. The HELOC is usually the cheaper way to borrow against the equity in your home. Personally, I’ve always used the HELOC – but your mileage may vary.
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Can I get a HELOC on my rental property?
Maybe. It can be much more difficult to obtain a HELOC on a rental property than your primary residence. That being said, it is possible. For whatever reason, the banks often consider investment properties to be riskier. There’s not a big market for HELOCs on rental properties, but they do exist. Be prepared to shop around.
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DISCLAIMER: I am not a financial adviser. I only express my opinion based on my experience. Your experience may be different. These videos are for educational and inspirational purposes only. Investing of any kind involves risk. While it is possible to minimize risk, your investments are solely your responsibility. It is imperative that you conduct your own research. There is no guarantee of gains or losses on investments.

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[kaylingonzalez]

Got my HELOC from my local credit union was able to get 90% !!

[iamCoachEddie]

I own a rental property in Michigan but live in New Jersey, and I have high-interest credit card debt. How can I shop for a HELOC loan without the bank pulling my credit and affecting my credit score?

[PROTOANYTHING]

80k Heloc

Use it to buy a rental house at current prices/% and battle the silent recession wave or use it as down payment for a construction loan?

[jordanplays]

I have a few expenses on my primary home, duplex, and air bnb. Totaling 70g’s. I have over 200k equity. Would a HELOC make sense for this? Thanks.

[jeremiahfoley]

I have a question from Boston mass have a lot of equity in my personal Al at 2.25 va, have great cash flow on my 6 in mass at 3.5 bought a single in Myrtle beach at a 7.9 would you think it’d be a smart move to heloc either ny house or 6 pay off the Myrtle and use both of those properties to pay it off or just wait next quarter for rates to refi? Thank you

[a.w.]

I apologize if these questions appear to be dumb, but if I obtain a HELOC & only use a certain amount during the draw period, I will only be responsible for paying back what I actually used as well as the other fees associated is that correct? Also, do lenders frown when you try to obtain two sources of financing, for one rental property? I can put an amazing down payment using the HELOC, but we still need more financing to purchase the property.

[stevefisher]

I have lots of equity in my home and my cash flowing real estate and excellent credit rating but lenders keep denying me because of the debt-income ratio? I want to improve my rentals and raise rents as well as add a number of ADUs. What can I do?

[coachcoop]

What to do if my Heloc draw period is ending. And I currently have the loan invested in an account. What are options I have

[johnnycostilla]

Can I use a heloc on current home to get into a new home and make the home I have a beloc on a rental?

[sheek]

I actually paid attention to every word he spoke I felt like I was in his class room.. thank you sir

[jgpainting]

I have good equity but my sister is part owner of
My home/ Our home, she has bad credit score and I’m on Soc Security. I would love to get a rental property this year!

[GamersClipsinfinity]

My equity is more than my outstanding mortgage. Is worth using the equity to pay off the mortgage or release enough money for a deposit on a second house to rent out

[dougwilkesartisanlogistics]

Anyone found a HELOC for a rental?

If the house is in your personal name TD Bank can do a HELOC.

[mrss]

These are not the tips for HELOC, it's general Q&A, or can call it an intro. Tips are the things we could do smartly to take advantage of HELOC.

[slashdash]

HELOCs are awful. Do t fall for this BS. It is basically a credit card attached to your house.

[barryredman]

Except for the fact that the houses you sold through your "Morris Invest" program in 2021/2022, are now underwater.