Lenders still doing HELOCS?

Mcdonna1980_IHB

Mcdonna1980_IHB

New member
I have a friend that is looking for a HELOC. Do they do these anymore? If so, which lenders are offering them? Are the rates killer? She owns a home in West LA. The house is worth at least 1.5 million and $416,000 is owed. The reason for the HELOC would be to pay off $100,000 in student loans. The student loans are running at 7-8% plus she can't deduct any of the interest.
 
They are still there, but I haven't seen the great rates like we have from our 2007 vintage, which is currently at 3.24%. However, B of A informed us this week that we can no longer draw on it due to a re-evaulation of the property value. About a year ago they cut the line nearly in half, but now they say the line is the same, but we can't draw on it??? Between the buy and bail idiots ruining the opportunity for responsible people to move up and this you have a credit line but can't draw on it, we once again feel like the people who did everything right, but are restricted because of what the idiots who did everything wrong did.
 
[quote author="Mcdonna1980" date=1248519174]I have a friend that is looking for a HELOC. Do they do these anymore? If so, which lenders are offering them? Are the rates killer? She owns a home in West LA. The house is worth at least 1.5 million and $416,000 is owed. The reason for the HELOC would be to pay off $100,000 in student loans. The student loans are running at 7-8% plus she can't deduct any of the interest.</blockquote>
Should be no problem, especially if she can find a local credit union.
 
The key is loan to value. Most banks will hit 70% LTV and stop. If you are under that threshold, all the biggies will lend HELOCs



Wells, BofA, USBank, Comerica, Chase... almost all of these are prime, plus 1-2% Some Credit Unions will go 75% LTV but they are few and far between.



I don't do these HELOC's but if your loan to value is 70% or lower, PM me for a referral to a Wells Fargo person who wont screw around with your deal.



My .02c



Soylent Green Is People.
 
[quote author="stepping_up" date=1248520037]They are still there, but I haven't seen the great rates like we have from our 2007 vintage, which is currently at 3.24%. However, B of A informed us this week that we can no longer draw on it due to a re-evaulation of the property value. About a year ago they cut the line nearly in half, but now they say the line is the same, but we can't draw on it??? Between the buy and bail idiots ruining the opportunity for responsible people to move up and this you have a credit line but can't draw on it, we once again feel like the people who did everything right, but are restricted because of what the idiots who did everything wrong did.</blockquote>


Consider yourself lucky. I have absolutely no interest in one of these. I believe they foster the indentured servitude that is so prevalent in our country. What good is owning a house when you end up becoming a slave to it? Sure, I'd love to remodel my kitchen, turn my master bedroom into a real master bedroom (instead of the box I have now) and re-landscape the yard, but at what price? I'd like to have something that is actually paid off before I retire, I don't want any payments. There was a time when I could have taken out 600K in equity from my house, now that I can't, I really don't care.
 
Just FYI, but from what I know and I could be wrong, but technically the interest on a HELOC is not tax deductible unless it is used for home improvements. Not saying that you can't deduct the interest, but if you get audited, you need to show what that HELOC money was spent on.



Paging awgee, paging awgee. Please pick up the white courtesy phone. Your services are needed in this thread to either back up graph or put him back in his non-tax related place.
 
[quote author="graphrix" date=1248749794]Just FYI, but from what I know and I could be wrong, but technically the interest on a HELOC is not tax deductible unless it is used for home improvements. Not saying that you can't deduct the interest, but if you get audited, you need to show what that HELOC money was spent on.



Paging awgee, paging awgee. Please pick up the white courtesy phone. Your services are needed in this thread to either back up graph or put him back in his non-tax related place.</blockquote>


From my understanding she will be eligible to deduct the interest. I read in the IRS 926 publication that married filing jointly filers can deduct up to $100,000 for non-improvement. The catch is your loans can't exceed the value of the home. I'm not a CPA and I haven't taken the time to research it thoroughly so Awgee please confirm.
 
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