Because a HELOC is secured by your home, the interest rates are typically much lower than personal loans or credit cards.
You are essentially taking on debt to acquire more debt. If the real estate market dips, you could end up "underwater" on both properties. Strategic Tips for Success using heloc to buy rental property
Most HELOCs have variable rates. If market interest rates rise, your monthly payments could increase significantly, eating into your rental profits. Because a HELOC is secured by your home,
Many investors use a HELOC to buy and renovate a property, then refinance that property into a long-term mortgage to pay back the HELOC. This "resets" the line of credit for the next purchase. your monthly payments could increase significantly
Making your bid more competitive and speeding up the closing process.