Which Version of the Strategy is Better? (1st Lien HELOC, 2nd Lien HELOC, and PLOC/BLOC)

There isn’t a right or wrong answer for this. It’s simply – which version of the strategy is the best fit for achieving your goals? There are Pros and Cons with each of the versions.

1st Lien HELOC

A 1st lien HELOC is convenient, requires less management, and offers more access to equity. It is more of a “set it and forget it” approach. If you have any interest in buying investment properties in the near future, the 1st lien HELOC might be the way to go.

Some of the downside is that you may see slightly less savings when compared to the 2nd lien HELOC.

2nd Lien HELOC

The 2nd lien HELOC gives you the most optimal results if you’re seeking to save as much time and money in most cases. Your cash flow will determine your success with this strategy. Also, you need to constantly check to make sure you’re chunking the right amount and monitoring the balance, but we give you a tool to help with that.

Another downside is that it gives you less access to equity.

PLOC/BLOC – Personal or Business Line of Credit

A personal line of credit does not secure or place a lien on your home. It’s almost like a credit card, but has a lower interest rate and it’s very liquid in terms of how fast you can access the cash. 

A PLOC is often connected to a checking account and the funds can be transferred in and out through online banking or by writing checks. Some PLOC issuers also give you a credit card which makes it convenient for retail purchases.

If you don’t have enough equity to qualify for a HELOC, we can use the PLOC/BLOC to make progress until your numbers qualify you for a HELOC.