It makes sense to rent money when you have a need for it. If you are doing three or fewer rehabs concurrently, you don’t need the cash, so why pay for it unless you are making a higher return on your personal funds than you will be paying in interest. When the fourth rehab pops up, and you need cash, then borrow.
You can set up an ELOC with low to moderate set-up costs, depending upon your bank. When you need the cash, all you have to do is write a check.
I was reading a book the other day and the author said you should sell or refi your investments every 3-4 years.You know,make the equity work for you.So this has got me thinking.I do rehabs mostly,but have a few rentals.one of my rentals has great cashflow and nice equity.I’m thinking about doing a refi on it or a LOC.What are your feelings on this subject.The reason I ask is because I started out using HML and now use all my on money (profits from the rehabs)I can do 3 at a time before I run out of money and either have to use hard money again or wait for them to sell.This is my current situation.I know this sounds like a no brainer,but I don,t know if I want to take out another loan.What do you guys do?