Before filling out that home equity line application, consider getting rid of your private mortgage insurance (PMI). If you put less than 20% down on your home, chances are the bank charges you PMI every month - fees that could exceed a thousand dollars a year. Most borrowers are able to get rid of PMI during [...] [...more]
In the last few years, bankruptcy laws have become stricter. In some cases, a judge will eliminate HELOC debt. However, it has been standard practice to keep debts in place in cases of fraud. If a borrower lies on a loan application (which happens regularly with stated income loans), a judge will generally not discharge [...] [...more]
If you’re a homeowner looking to purchase a new property, you may be able to use a home equity line of credit (HELOC) as a down payment. In order for this to work, your current property must have a significant amount of equity (usually at least $20,000 worth). If you are planning to sell your current [...] [...more]
Many home equity lines offer an interest-only feature. Interest-only HELOCs are risky to the borrower; however they do provide more manageable monthly payments during the first few years. Here’s how these credit lines work: First - The interest-only HELOC is opened. The borrower agrees to a set number of years for the withdrawal period and a set [...] [...more]
If you’ve received a HELOC freeze notice, you have more to worry about than a lack of funds. A decrease in your credit limit may actually harm your credit score. Here’s how: If you have a lower limit (under $20,000 usually, but no one knows the exact figure), your HELOC is probably reported to the credit bureaus [...] [...more]
Have you seen the commercial where the home shopper freezes her credit cards in a chunk of ice? When she sees a “call now to buy” number on TV she frantically starts chipping away at the ice cube. But, by the time the commercial ends, she stops chopping and changes her mind. If borrowers had [...] [...more]
If you are using over 40% of your available credit, paying off your credit cards with a HELOC may improve your credit score. However, there are some risks involved. Applying and opening a HELOC will give your credit score a ding. However, you may be able to increase your score significantly by transferring your credit card [...] [...more]
Opening a home equity line of credit (HELOC) will give a small ding to your credit, just like taking out any other type of loan. Your use of HELOC funds may also impact your FICO score, depending the credit limit you’ve been given. Low Credit Limit HELOCs If your lender gives you a low credit limit, FICO [...] [...more]
If your HELOC has been frozen, getting your original limit back is a long shot. However, you can try to “thaw” your frozen line by requesting a new appraisal. A recent CNN Money article explains: “Call the lender’s customer service department and ask if it has an appeals procedure. “You generally will need to demonstrate that [...] [...more]
One of the biggest complaints of homeowners hit by the HELOC freeze is that most lenders have not done new property appraisals. Instead, they’ve determined lower property values by using the automated valuation model (AVM). Today, Tanta of the popular Calculated Risk blog explained that homeowners should not be surprised - especially because most HELOCs were [...] [...more]
