Most people dream of financial freedom, but few take the necessary steps to achieve it. Real estate investing is one of the most potent ways to build long-term wealth, yet many aspiring investors struggle with the same question: Where do I find the money to buy my first property?
For Elena Rajan Beatty, the answer came from her own home. Instead of waiting to save cash or relying on expensive loans, she tapped into her existing equity. Her choice between a HELOC and a home equity loan gave her the flexibility to buy her first investment property and start a portfolio now worth more than $5 million.
Her story offers a roadmap for anyone looking to leverage their home equity to fund investments.
Both a home equity line of credit (HELOC) and a home equity loan allow you to borrow against the equity you’ve built in your primary residence. However, they work differently, and the choice can have a significant impact on your investment strategy.
A HELOC works like a revolving line of credit secured by your home.
Pros for investors:
Cons for investors:
A home equity loan is a lump-sum loan secured by your home’s equity.
Pros for investors:
Cons for investors:
Elena didn’t have a large savings account when she began investing. What she did have was equity in her primary residence. By opening a $45,000 HELOC, she gained immediate access to funds for her first rental property, just ten houses down the street.
This move shows why a HELOC is often the better choice for beginners. Unlike a home equity loan, where you pay interest from day one, a HELOC lets you borrow only what you need. That flexibility enabled Elena to purchase, renovate, and eventually recycle the same funds into additional deals.
After that first success, Elena adopted the BRRRR strategy (Buy, Renovate, Rent, Refinance, Repeat). She used her HELOC funds to buy properties, renovated them to increase their value, then refinanced to extract cash and pay down her HELOC.
This cycle allowed her to reuse the same $45,000 multiple times, turning one deal into dozens. Her portfolio grew from a single rental to 35 units, generating $15,000 per month in cash flow.
This is where a HELOC shines compared to a home equity loan. The ability to draw, repay, and draw again fits perfectly with repeatable investing strategies.
While Elena’s success shows the power of a HELOC, a home equity loan can be useful in other situations:
For some investors, especially those newer to managing debt, a home equity loan provides structure and stability.
Elena’s story doesn’t end with a HELOC. As interest rates rose, she pivoted to seller financing, where property owners act as the bank. This allowed her to secure terms like 4% interest amortized over 30 years with five-year balloons; deals no commercial lender would offer today.
She also innovated by asking sellers to finance only the down payment portion of a purchase. This lowered her upfront cash requirements while still allowing her to use traditional financing for the bulk of the loan. For the seller, it created ongoing income backed by collateral. For Elena, it was another way to expand without draining her capital.
Elena emphasizes that deals don’t happen overnight. Many of her seller-financed acquisitions took more than a year from the first conversation to closing. Sellers want to work with people they trust. By focusing on relationships rather than quick wins, she built a portfolio that continues to grow, even in challenging markets.
Her advice: Expect 99 rejections before you find 1 yes. That single yes, however, can change your financial life.
Many investors hire property managers right away, but Elena decided to manage her own 35 units. The savings were substantial, roughly $5,000–$6,000 per month.
Beyond the savings, self-management gave her:
For new investors, self-management may feel intimidating, but Elena insists it’s manageable. Most of the work occurs during tenant placement, rather than day-to-day operations. With digital rent collection and good tenant screening, managing properties is less overwhelming than many assume.
Q: How much equity do I need to open a HELOC or home equity loan? Most lenders allow you to borrow up to 80–85% of your home’s value, minus what you still owe on the mortgage.
Q: Is a HELOC riskier than a home equity loan? A HELOC carries variable rates and flexible borrowing, which requires discipline. A home equity loan is more predictable but less flexible.
Q: Can I use both a HELOC and a home equity loan? Yes. Some investors use a home equity loan for a large rehab project while keeping a HELOC for smaller expenses and future opportunities.
Q: Which option is better for new real estate investors? A HELOC is often better for beginners who want flexibility and plan to recycle funds across multiple deals. A home equity loan may be better if you prefer fixed payments.