This time-tested approach to start-up funding is always an option.
Understanding HELOC:
Typically, this is based on the equity you have in your home or other properties. Usually if you are in good standing with your financial institution and are currently working when you apply, you should be able to free up approximately 40 % of your equity with the major banks. At secondary institutions, they may allow you a larger equity line but interest rates might be higher also.
Advantages:
This option has several advantages to a traditional loan.
• It has the lowest interest rates.
• This is usually an interest only loan. That means as you start your business you only need to pay the interest each month not a fixed principal amount.
• You can pay down the loan at any time without penalty.