Welcome to passive real estate investing, the show where busy people like you learn how to build substantial passive income while creating wealth for the long term.

And now here's your host, Marco Santorelli.

Hello and welcome to another episode of Ask Marco,

where I answer your investing related questions.

Before I get to today's question from Jason, I just want to remind everybody to smash that

subscribe button, remember to subscribe to the show so you never miss an episode, and that way I can continue to put these out and you won't miss a great question from

listeners like yourself. So I hope everybody is doing well and not going stir crazy with the crazy times that we are living in right now.

So I will continue to do these episodes and today's question comes from Jason.

He says, Dear Marco, we are looking to take out a Helock, a home equity line of credit, on our primary residence for the purpose of buying our next home.

And I assume he meant property here. Since I am a licensed residential contractor,

I would like to find a new construction opportunity or a fixer upper fixer property to renovate with the plan to refinance both of those properties into a conventional 30 year fixed rate loan at the end of the project.

Currently we have around $80,000 available through a home equity line of credit and

that's assuming you have an 80% loan to value which is

typical and some cash. My question for you is two parts. First would we be able to

get better loan terms as a construction loan, and he says here

slash line of credit, which are really two different things, through my business or would it be more favorable to finance this as a personal loan?

I know a big part of the answer depends on the deal itself, but any input you have is appreciated.

Secondly, there are a lot of Helock, Home Equity Line of Credit, products out there.

What terms should we be looking for in a favorable agreement and are there terms we should try avoid.

Thanks for taking my question, Jason.

Well, Jason, thanks for the question.

Here's my quick thoughts on this.

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