In this video, I discuss whether using a HELOC (home equity line of credit) for a down payment on a second property is a good idea, explaining that it depends on whether it's for a vacation home or an investment property. I generally advise against using a HELOC for a vacation home that won't generate income, but I'm more open to it for rental properties that will produce cash flow, as long as you have a clear plan to pay off the debt within 6-12 months. I share my own experience of using a HELOC to buy an investment property in all cash, then refinancing to pay down the line of credit quickly.
