Equity Line of Credit (H.E.L.O.C.) - Posted by Jake CA

Posted by Stacy (AZ) on April 08, 2002 at 11:36:44:

I just wanted to chime-in regarding the Big Bank vs. credit union or small local bank discussion. Of course, Eric, your advice is right on. The local credit unions and small banks are usually much more open to different options. But I wanted to mention one exception. Sometimes Bank One can be extaordinarily cooperative. I’ve used them several times and was always very pleasantly surprised at how quickly and easily my loans were approved and funded.

It’s funny. A couple years ago I was looking for a low interest second at greater than 80% CLTV. I didn’t even consider my own bank, Bank One, since I envisioned them as one of the uncooperative large banks. Then Ed Garcia mentioned in a post that Bank One had a good loan program. Ever since then, I always include them in my shopping list for any new loans.


Equity Line of Credit (H.E.L.O.C.) - Posted by Jake CA

Posted by Jake CA on April 08, 2002 at 07:37:21:

Has anyone here received a H.E.L.O.C (home equity line of credit) on there rental or non-owner occupied property? Do you know of any lenders that may do this? Every application I see won’t let me get a H.E.L.O.C unless I’m it’s my primary resident I don’t want an equity loan because I really don’t need the money I just want access to it, there’s well over $125K there available. All the numbers (equity position for lenders are there) and my credit is excellent I could get creative with paper notes however I’d still like the line of credit I want to stay legal so I really don’t want to lie and say it’s my primary resisent or should I…any suggestions?

Jake, CA

Re: Equity Line of Credit (H.E.L.O.C.) - Posted by Dave

Posted by Dave on April 08, 2002 at 11:55:56:

Bank of America will create a HELOC for a non-owner occupied based on 70% equity

200K FMV, Loan of 100K, 70% of 200K is $140K - 100K for loan = 40K available for HELOC

This is at a lowest interest rate level. I have my primary HELOC with them as well and that limit is 80% equity.

Re: Equity Line of Credit (H.E.L.O.C.) - Posted by eric-fl

Posted by eric-fl on April 08, 2002 at 11:11:33:

If you lie and say it’s your primary residence, you could go to jail. There are some things legitamite investors do from time to time that are “non-traditional”, but about the worst that can happen from those is that you’ll lose money. Lie on a loan app, or other such scams, and you could lose your freedom. The reason is because it is fraud, and the reason it is considered fraud is that the first element of fraud is a mistatement. If you are intentionally telling someone something you know to be untrue, you’re just asking for it.

Now that that’s covered, I did get on equity loan on a rental, and it wasn’t hard to do, but I believe it was a straight loan, not a line of credit. I’ve also done home equity lines, but those were on a personal residence. The best advice I can give you on this is to deal with a credit union or a trustworthy mortgage broker, vs. a regular bank. They are much more customer oriented, and will almost certainly have more options available. Shop around a little bit. There’s more money available right now (courtesy of the Fed), than I’ve ever seen.