Investing in 2024: Why you need a HELOC


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Investing in 2024: Why you need a HELOC

Investing in 2024 will look completely different compared to years past. Investors will need more liquidity due to the increasing lending squeeze from banks. What do I mean by liquidity? Liquidity is the money that is available to you to help fund deals. These funds are not from lenders, but are instead from you. Now is the time to fill your liquidity buckets to the brim. One of the best cash reserves is a HELOC. What is a HELOC and how can it help you save for a rainy day? Let’s take a closer look.

What is a HELOC?

A HELOC, also known as home equity line of credit, provides a revolving line of credit that can be used at any time. HELOCs are normally used for large expenses, paying off high interest rate debt, and any additional expenses that you may face. Investors are feeling the pressure of the lending squeeze from both banks and credit unions. They are both driving down their loan to value percentages and putting more pressure on investors. What started at 90% LTV a year ago, has now plummeted to 75% LTV, and in some cases even 70% LTV. Loan to values are shrinking fast, so now is the time to lock everything in before it drops even further! Make sure that you get HELOCS wherever you can! This can be on your primary residence, as well as on all of your investment properties. Remember, you don’t have to use the funds from the HELOCS immediately, the money is just reserved for a rainy day. While it may cost a few hundred to close your HELOC later on, it is a great resource to have when buying properties, making payments, doing construction, or any additional expenses that come your way. 

The Time is NOW!

The goal before the end of the year is to fill your liquidity buckets! By opening a HELOC you can fill your liquidity bucket to the brim in preparation for  2024. As investors, we are all going to need these extra funds for down payments, escrow, paying contractors, as well as any other expenses that come our way.  Lenders are going to require you to be more liquid, have more reserves, and put more money down. Investors who take the time at the end of this year to prepare, will have more opportunities and a huge advantage in 2024 over those who don’t act now. 

Watch our most recent video to find out more about why you need liquidity. 

If you have any questions on liquidity, finding HELOCs, or have any other questions, please reach out to us!

We would be happy to help guide you to become more successful in 2024.