Tapping your equity with a Home Equity Line of Credit

Guest

Does opening a Heloc with high limit affect FICO score?

larry · Joined: 27 Jun 2007 Posts: 3328 474.49 Dollars($)

Hi Archie,

Welcome to the forum.

I don't think that a opening a high limit HELOC affect your score. Instead if you can make the payments on time regularly then it can help you to increase your credit score.

Feel free to ask if you have any further questions.

Best of luck,
Larry

Samantha

Heloc being a revolving debt, when the credit bureaus calculate your credit score, they'll consider the ratio between your outstanding debt and available credit, not how much of credit is available to you.

If you can maintain a debt to available credit ratio of 25% or even lower, your score would remain unaffected. Beyond this ratio, there may be a negative influence on your score.

Hope this helps...

God bless you.

Samantha

Guest

I hate my current job but feel stuck because of my mortgage.MY husband and I have started the ground floor work of 3 apartments at the back of our home, but we need about $50,000 to complete the work. Sould we mortgage our home?. I just do not know what to do. We are thinking about finishing the apartments and selling the entire building, which when completed should sell for about $300,000,but we are afraid if it will be sold, how quickly and if it will be sold at our price. If sold we can pay of our first mortgage and pay of the loan. What should we do?

jameshogg · Posted: Fri Jan 02, 2009 10:57 pm Post subject:

Hi tameca,

A query similar to yours has been answered in the given link:
http://www.mortgagefit.com/loantalk/selloff-apartments.html#71246

Please take a look at it. I hope it will help you.

Thanks

Guest

Does any one know how this scenario works?
2nd lender changes the secure heloc to unsecure revolving credit card and keep it on your credit at the time of short sell? Then the borrower has to carry it like a credit card and keep making the monthly payments.
What would be the effect on credit score and obtaining future loans?

Thanks

Caron · Posted: Fri Feb 06, 2009 6:03 am Post subject:

Hi R,

There's nothing to worry about it. Basically, the mortgage balance couldn't be recovered through the sale. This is why the lender wants you to pay the rest in the form of an unsecured loan. The loan becomes unsecured because the collateral has been lost due to short sale.

The short sale will reduce your credit score by 80-100 points. But the second mortgage changing to an unsecured heloc won't affect your credit in any way. However, you need to keep making on-time payments in order to pay off the unsecured loan.

Good luck

Guest

I live in California with my wife. In 2005 she became ill and could not work, so by the summer of 2007 we defaulted on our house. The bank agreed on short sale and the house was sold January 2008. When we bought the property the bank set up the finance with two loans, the mortgage loan (80%) and a line of credit (10%). The last 10% we put down. The property was sold for $215 000 less that we paid for it. We received a 1099-C this year for the mortgage loan but nothing for line of credit.
My question is now: There is a company that bought the HELOC debt from the bank who is calling me and they want me to pay the loan back. We don’t have the finance now ($65 000), and I don’t know if we ever will. So what can I do?

eric1 · Posted: Tue Jun 16, 2009 6:31 pm Post subject:

I would be careful about paying anything to a third party company. Could be a potential scam

Guest

Can the outstanding balance of a HELOC be included in a refinance of a 1st and 2nd mortgage to a single loan? Is this scenario even allowed? Confused

savior70 · Posted: Sat Nov 21, 2009 6:32 am Post subject:

Hi Guest,

You can refinance both the first mortgage and the home equity loan into a single loan. But there has to be enough equity for you to be able to do so. In fact if there's enough equity in the property and you can refinance both the loans together at a lower interest rate, you can save a lot of money in interest.

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