1) Revolving Line of Credit: A HELOC provides access to a predetermined credit limit, which you can borrow from as needed during the draw period. You only pay interest on the amount you actually borrow, not the full credit limit.

2) Draw Period and Repayment Period: HELOCs typically have two phases:

Draw Period: This is usually 5 to 10 years, during which you can borrow from the credit line. During this time, you may only need to make interest payments on what you borrow.

Repayment Period: After the draw period ends, you enter the repayment period, which is usually 10 to 20 years. During this phase, you can no longer borrow additional funds and must repay both principal and interest on any outstanding balance.Eligibility: Loans must be deemed business purpose loans and be exempt from the Ability to Repay (ATR) and Qualified Mortgage (QM) rules. Investment properties only.

Purchase, rate & term refinance, and cash-out refinances are allowed.

Maximum loan amounts vary by product and property type.

DSCR Calculation: The DSCR is calculated by dividing the gross rental income by the proposed PITI (Principal, Interest, Taxes, Insurance, and any applicable association dues).

Property management fees disclosed by the borrower or identified in the loan file must be included in the PITI calculation.