HELOC (Home Equity Line of Credit)
A revolving credit line secured by property equity, typically variable-rate (Prime + margin). HELOCs on investment property are rare and capped at 65–70% CLTV. Often replaced by DSCR cash-out refis for serious investors.
Why it matters on a DSCR loan
Investors most often use a HELOC on their primary residence as a flexible down-payment fund, then let the DSCR loan carry the investment property itself. Keep in mind the HELOC payment is real debt in your personal budget even though DSCR underwriting ignores your income — overextending a variable-rate line to buy multiple properties is a common way investors get squeezed when rates move. For pulling equity out of a rental specifically, a DSCR cash-out refinance is usually the more available tool since investment-property HELOCs are scarce.
Related terms
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DSCR Calculator Get a QuoteReviewed by Arin Baghermian, Broker Owner — NMLS #1220456 · Last reviewed July 2, 2026 · DSCR Capital Partners is a brand of UTM Financial, LLC (NMLS #2591548).