HELOC Explained For Beginners

In this podcast episode, you'll learn about HELOCs (home equity lines of credit) for real estate. HELOCs have good things like low fees and affordable interest rates. Also, if your home's value goes up, you can borrow money based on its new value.
With a HELOC, you can buy more real estate without selling what you already have. But be careful about changing interest rates and rules.
Overall, a HELOC is a great way to fund your first real estate investments, especially if you already own a home. The money you get can be used for renovations, down payments, and more.
Watch this video to learn all about HELOCs and how to use them. Check it out!
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0:00 Intro
1:37 About D’Andre Clayton
2:20 What is a HELOC?
3:45 Difference Between a First and Second Lien Position HELOC on a House
5:29 Why is a HELOC great for credit?
7:46 What Type of Credit Score Should the Average Person Need to Get a HELOC?
8:13 What Score is Needed on a Second Lien Position HELOC?
8:59 Is it Better to Have a 1st Lien Position or Second Lien Position HELOC?
12:36 What Other Opportunities Does a HELOC Present?
15:28 Why It’s Important to Have a HELOC?
18:30 What Would You Say to Someone on the Fence about this?
21:45 What are HELOC Interest Rates Today?
22:22 What if Your Scores are Lower with Today’s Interest Rates?
24:25 Why Interest Rates Doesn’t Matter?
30:34 What’s the Difference Between Amortized Interest and Simple Interest?
35:12 How Does a HELOC Affect Taxes?
40:10 What Are the Dangers of Using a HELOC?
49:43 Best HELOC Methods
53:13 HELOC Examples
1:03:55 Contact D’Andre Clayton
1:05:23 Recommended Books
1:09:56 Last Words
#heloc #realestate #jamelgibbs #homeequitylineofcredit #investingforbeginners

[@jamelgibbs]

Find off market lists of absentee, pre foreclosures, 40% equity, single family. Get 30% off Propstream: bit.ly/vippropstream

[@TEKNIKS81]

With the second lien heloc when it’s available you can put that full amount towards the first lien mortgage in order to pay off the mortgage faster therefore paying speeding up the whole process of paying off the mortgage faster… essentially unlocking more equity that you can take a bigger heloc out after the first heloc is paid off

[@lanilani5774]

You have just given me the ability to renovate a property I bought for renting and to start another business. Thank you for this video because I didn't know how to get it done before. Thank you for sharing your knowledge.

[@jamelgibbs]

That’s great.

[@andrewslife1979]

This is bad advice you'll probably get foreclosed on before you're able to pay back the loan

[@rickykingi5191]

Hey Jamel hopefully you see this, so glad I’ve come across this channel.. just a question, what’s the criteria needed for the HELOC & would this apply to here in Australia 🇦🇺? Hear from you soon thanks 🙏

[@MerianyBenthin]

Thank you for this content and explanation. Getting a Heloc makes a lot of sense to me but fear always stop me. My house is paid off, but I’m drawing in debt due to a health issue I had -which is over now thanks be to God. Teachings like yours helps me to get a little more courage to act. God bless!

[@kingjudah22]

I watched this twice. Great information and nice flow. You guys need to link up again. Very thankful for the free game. Peace.

[@scottscott45]

Man I’m checking on a heloc Monday, I’m a beginner in REi and was about to take a hard money loan for a cash flowing property I have a purchase agreement on, I’ve got 250k equity in my personal home. Thanks for the knowledge!

[@ralphyboy3856]

credit score is always the key to get started, I'm sitting a ton of equity on my home but can not touch it cause my score not good enough. Bummer cause I wish I can pull some and get ride of high credit card intrest and truck. 😮‍💨😮‍💨

[@nunya2954]

Can I ask what your credit score is?

[@danahoward759]

Im loving how he makes this so easy to understand. I thoroughly enjoyed all the information and insight

[@natanyagaston5731]

This information was mind blowing to me. I felt like we've been sitting on an opportunity and not knowing what to do with it. Definitely going to see what option is best for us! Thank you Jamel and D'Andre!

[@eileenwatt8283]

Make sure you have life insurance on yourself and unemployment insurance incase you pass and if you are ill and unable to work. These guarantee the loan will be paid.

[@Kingjosiahmba]

How do you go about it

[@workingonit5107]

Great info given in a very easy to understand way, subscribed

[@RyanKeefeMusic]

Very solid content right here! This was exactly what I was looking for!! Thank you for this!

[@iramcc409]

Another great video! You guys definitely dropped a lot of game here. Thanks!

[@Phillip_01]

Mr.Gibbs, thank you for this content!

[@annyalvarez5516]

Omg you guys! I cant thank you enough for all this amazing information you shared in this video! You are the best. Thank you!!!! God bless you.

[@emilylawrence2349]

Howto get in touch with the speaker

[@detroitstateofmind6203]

Truly enjoyed all of the information ✌🏾 God Bless Both of You 🙏🏾

[@Phillip_01]

Badass content right here!

[@diamondtasha_nailz8758]

Knowledge is so powerful

[@saundyfx6126]

I'm completely new to this and I'm seeking the information. Thank you for your video.

[@Elffornow]

Really appreciate your time and info! Thank you

[@hedgefund996]

Awesome Educational Content

[@96ej]

At what income level does this make sense for most people

[@lisaterry1007]

Thank you both. I appreciate the patience your giving to us with this videos, building the community. 🙏

[@jamelgibbs]

Our pleasure!

[@latoniamb]

Thank you for the information.

[@antoniofergus9680]

Really great information...

[@773group]

@6:30 That little laugh by the host means his pulled that before. 😂

[@RicoMonterrico]

Thanks for the Gems

[@pamelahjones7656]

This is great

[@josephedwards9645]

Please send more information. Thanks Guys!

[@k.johnson2120]

This is fire!! Thank you 🙏🏾 guy’s for real! I’m presently waiting approval for my first lien heloc and I’m seeking wisdom on how to incorporate a mutual life insurance plan paid through the heloc. If you’re available to advise. Thank you. Kerry

[@jamelgibbs]

↓Subscribe for more real estate investing tips↓ reieducationacademy.com/KZbin-Subscribe Also, share and leave a comment below.

[@christygray8616]

My money goes to my business. Can you talk about how that would work.

[@nunya2954]

I don't understand on HELOC, if there is only interest paid in the beginning, how do you ever pay the principle down? Is there a penalty for early pay off?

[@rachelf4883]

Such an informative video! I want to hear more about the 32 year old investing 100k. What are the specifics and where to invest?

[@user-pt7og3ys1y]

Does a heloc replaces a first position mortgage

[@tamergendi8864]

Great video and explanation. Do you have a spreadsheet to compare mortgage to Heloc?

[@WAARBA]

Great Video, thank you for putting this together. Question- what happens to. My ‘second position heloc’ after I pay off my ‘first position’ mortgage? Does/will the heloc still only charge interest only on any charges?

[@therealopenair247]

Great video I love the Contant I just have one question that I’m confused about, so can I take a first lien position if I already have a mortgage that is not paid off credit scores great 782, but I was a little confused as if I need to take a second lien position because I already have a mortgage that’s not paid off

[@shannonford806]

If you take out a HELOC can you purchase an investment property with the funds and how soon?

[@chauncyjohnson7582]

Yes you can take out funds from a heloc if you have enough equity in your home or property.

[@rachelf4883]

Please do a video on HELOCs and estate planning. Does the same dangers apply with mortgages?

[@dandreclayton7936]

Great questions the dangers of not having your estate planning done apply to every situation is there is any transfer of wealth or possession or perhaps if there is a need to be kept alive while incapacitated. If your estate plan isn't done bankruptcy and foreclosure should be an expected result if your alive when a life altering event happens, 70% of people need Long-term care the older they get. If it isn't done and you've died, Probate and the confiscation of the property and perhaps having unclaimed funds that are stuck in the state treasury should be the expected result.

[@awakeninvestment]

@@dandreclayton7936 have a question. What if you have a home, and you were in forbearance. After forbearance I’m doing a partial claim to bring the loan current. How does the HELOC work with that? Would that need to be cleared up before applying? Also what does my credit profile need to look like? I know the score is 680 for first lien position but what about the credit profile such as collection accounts, closed accounts that’s charged off?

[@user-cy2nm7ov1v]

What are the best ways to begin I you have debt? Should you pay that off first?

[@victoriar1336]

Thanks so much for this valuable info. I live in Washington state, I’m a homeowner with close to 300,000 equity in my home. Twice I was denied a home refinance using the equity in my home to mainly renovate my kitchen and pay off an IRS pass through tax liability debt. I wish the lenders had suggested or even told me the difference between a refi & HELOC loan. My question is that I just initiated my second try at a refi and was again denied, but is it too late to convert this application to a HELOC if the application was started on Aug 25? Any help/suggestions will be so appreciated. Thank you

[@Kevingotheart]

1:01:41 teachers need to make more $😤💯

[@pbdmd3688]

Is 1st lien HELOC available and allowed in Texas? I have 2 primary and 3 investment properties in Dallas TX. I would like to explore it for sure.

[@lindsaypena8154]

What is the best back to apply? I live in GA.

[@tatyanacrute274]

Thank you, guys, for a very informative material I learn from you! I've asked my FCU about 1st lien position heloc - they don't offer it now, they do offer 2nd lien one 4.99% for 9 months Promotion period with 10 years draw period and 10 y. pay back. They only offer it with mortgage insurance which I would wish not to have. I've been using 13 k ploc to pay off my mortgage, don't have much other debts. I almost half way of paying it off utilizing VB. Would you recommend to get a 2nd lien heloc with mortgage insurance vs. using slower working ploc? I have more than 2k cash flow it helps to pay off 10k chunks in a shorter time. I greatly appreciate if you could answer this my question.

[@Lisa-nt7wt]

I really enjoyed this video. I don't worry about interest rates for my mortgage because I utilize velocity banking. Extra payments towards the principal helped me payoff 2 vehicles and now my house is almost paid off in 1 year ! Helocs may be something I try in the future. Thanks😊

[@nunya2954]

How do you do veloicity banking to pay off a mortgage early

[@evaperez3732]

Velocity banking is the "HELOC" strategy

[@yourwealthspecialist]

jamel.....not sure if you will see this or not but have been watching a few of your videos related to HELOC's ..... I do IBC exclusively and want to incorporate using the Heloc but truthfully not sure which direction to head in - can you offer any suggestions or be willing to chat a few minutes?

[@daddygamer5552]

I’m sorry guys, I’m trying real hard to understand but I’m still lost and confused? How do you put your first position mortgage into a first position HELOC and pay it off in 7 years?? What???

[@hunterchasemaynard2529]

I have a ?. I have a son on SSID. will putting him on the Revocable trust affect his benefits?. He will be 18 in October

[@ewill5458]

Can you please tell me how do I reach Mr D’Andre Clayton

[@abelinenoncent8540]

Hi gibbons can you help me with existing house to buy a second house

[@garyarnold2825]

Now, I understand HELOC but doesn’t the majority of Mortgages have Escrow included, therefor, when you use a HELOC, should there be a plan to pay Taxes and Property Insurance? What is the answer to this additional liability for homeowners (sometime roughly $7,000 a yr.). I’ll be checking back for a response.

[@dandreclayton7936]

Yes when we perform the calculations we include the Escrow of the Homeowners Insurance and taxes.

[@keithwisdom1663]

Unless you inherit or have a high salary you have to invest in stocks real estate and or business.

[@jamelgibbs]

That’s a fact.

[@danahoward759]

I owe $39,000 on my home i purchased in 1998.. So...should I pay my home off and then get a HELOC?

[@wallacemiles975]

🎉

[@times461]

I don't have over an hour time to watch this....

[@tyrondrew250]

What if your house is paid for free and clear and worth 100,000

[@andrewslife1979]

Here's what I know about a heloc... Don't take it live within your means instead

[@JC-hd2tt]

For the love of God, don’t refinance your low interest mortgage to a first lien HELOC! There is no such thing as amortized interest. You’ll be paying more with the higher interest HELOC. Just pay extra to your principal if you really want to pay off your house faster. If it really makes you feel better, have a second lien HELOC but don’t use it unless it’s an emergency.

[@dandreclayton7936]

I always love when I see comments like this. So first I will will agree with one part of the statement you made. Don't Refinance into a First Lien HELOC but there's an if. That IF is if you don't have a decent amount of cashflow or have not learned how to budget. Now if the opposite is true however we make sure to include in our calculations for the clients the Effective Interest Rate of the loan which would be the equivalent if a person had the HELOC in place for the 30 years following our strategies. Just yesterday we did a calculation where the client cashflow was 3k and their effective interest rate if the loan was amortized came out to be calculated at 1.4%. So I guess the question is can you find an interest rate lower than that in today's market.

[@HugoBobea]

Worst explanation ever. I am lost.