Half Your Mortgage
What Is a Debt-To-Income (DTI) Ratio & How Is It Calculated
Before a lender approves any mortgage application, the underwriting department verifies one's ability to repay the loan first. The mortgage isn't the only payment that a borrower will have - there are car loans, student loans, personal loans, credit ...
What Is A Front-End Ratio / Housing Ratio
A front-end ratio or housing ratio divides one's total monthly mortgage payment, also known as a PITI (Principal, Interest, Taxes and Insurance), by one's monthly income. For example a monthly mortgage payment of $1,000 with a gross monthly income of ...
Combined-Loan-to-Value (CLTV) vs Loan-to-Value (LTV) Ratio
CLTV and LTV are both similar figures describing how much equity one has in their home versus how much is still owed on the mortgage. LTV only takes into account the first mortgage, while CLTV factors in the first mortgage and any subsequent home ...
What Does A Title Company Do
The title company's job is to find out if the property title is “unencumbered”, meaning no one other than the seller has ownership rights to it (i.e. no liens, no debts, no alternative deeds). Contact the title company after a bank HELOC is chosen to ...
Can a Veteran Affairs Loan (VA), United States Department of Agriculture's Loan (USDA) or The Federal Housing Administration Loan (FHA) Be Refinanced Into a HELOC
Yes, every home loan can be refinanced into a HELOC.
Mortgage Insurance (MI) + Private Mortgage Insurance (PMI) vs Mortgage Protection Insurance (MPI) + Mortgage Insurance Protection (MIP)
Both Mortgage Insurance (MI) and Private Mortgage Insurance (PMI) are a type of mortgage insurance one might be required to pay for with a conventional mortgage, which only protects the lender should the borrower stop making payments on the loan. ...
How Does A Student Fund Their Whole Life Insurance Policy Using A HELOC
One of the benefits of a HELOC is that students can pull out equity from the HELOC and put it into the whole life policy. Students like to have liquidity (cash) sit in their whole life policy. One will wire the money to the insurance provider, and ...
What Is The Monthly Payment For The HELOC
That depends. An outstanding balance will have a minimum monthly payment, which will fluctuate each month during the draw period because the payment is based on a few different factors, including: The total amount of funds withdrawn or transferred ...
When Will The Account Post The Payment Made For The HELOC
Payments are credited to the account according to the lender's terms and conditions. When payment is made online, it may take up to 1 business day to credit. When payment is made by mail or phone, the payment is credited when the lender receives them ...
Where Can We See Payments Made for The HELOC
All transactions and payment history can be found online through the lending institution's online banking portal.
Can A Payment Be Skipped With A HELOC
No, one must make at least the minimum monthly payment.
How Is The Annual Percentage Rate on The HELOC Determined
The HELOC APR is typically a variable interest rate and can change as often as monthly based on the index rates (e.g. Prime Rate). Some APRs may be a fixed rate determined at the time the feature is set up.
Why Did The APR Change on The HELOC
The APR on a HELOC is often tied to an index (e.g. Prime Rate). When these rates change, so does the HELOC's APR.
How Often Does The APR Change For The HELOC
It could change as often as monthly depending on the changes to the United States Prime Rate. These changes in APR are always effective on the first day of the monthly statement period and remains effective for the entire statement period.
Is There An Annual Fee For Every HELOC
Yes, virtually all HELOCs have an annual fee. Thankfully this fee is usually $100 to $250 (highest ever seen was $1000).
Can The HELOC Loan To Value Be Changed Later
For most lenders, this is a 'yes' but any increase/decrease in the credit limit will require a new application to be completed.
How Can Someone Close Their HELOC Account
Talk with the loan officer or lender to make sure there are no early penalty or fees. Once there is a $0 balance for the HELOC, visiting a branch or calling the lender's Customer Support will provide an employee who can provide assistance in closing ...
Can Someone Keep Their HELOC After Selling The Home
No. When the home is sold, the loan must be repaid in full. Most homeowners arrange to pay off their HELOC at the closing of the home's sale. One should not borrow funds from the HELOC once the sales process has begun.
We Need Help Lowering Our HELOC Payments Due To Loss / Income / Medical Issue
One can get the HELOC payment down a bit by contacting the lender and asking them to recast the loan by stating, “Can this loan be recast with the remaining principal balance, over a 30 year term, so it drops the minimum payments?”
Will The Banks Offer Promotional Rates or Advertise HELOCs In A Down-Turned Economy
The banks are begin to flood the markets with advertising for HELOCs and offering promotional interest rates below prime rate for two reasons. One, they need new customers / loans to originate. Two, a HELOC is a private loan (not federally regulated) ...
What If We Experience A Serious Health Issue During Indexed Universal Life (IUL)
Any serious health issues that arise after a policy has been issued will not affect the policy holder. This applies to Whole Life Insurance (WLI), Indexed Universal Life (IUL) and Variable Universal Life (VUL).
What Is Premium Financing & How Is An Insurance Policy Used As Collateral
Premium financing is the ability to borrow yearly against one's whole life policy. One will approach different banking institutions who will collaterally assign this insurance policy just like a mortgage or any other loan. The institution will then ...
What Does The Effective Rate of Interest (ERI) Mean
Debt in an inflationary environment with low interest rates is virtually free. This is due to the combination of the cost of goods and services going up in relation to the cost of money. When one applies a tax deductibility to this interest rate on ...
What Is The Easiest Way To Get A HELOC For A Rental Investment Property
It is easy to get a HELOC for a rental transaction. It merely requires starting with a mortgage and refinancing into a HELOC after the seasoning period.
Can Real Estate Investors (REI) Establish a HELOC Against Their Entire Portfolio
Yes and no. Doing this is very difficult using the same strategy we teach in the program. Why? The banks will give lines of credit where the investor has interest-only payments, but the banks don't want anyone to pay it off early which is why they ...
$100K Business Line Of Credit (BLOC) vs $100K Hard Money
A hard money loan is a specific type of asset-based loan financing through which a borrower receives funds secured by real property. Hard money loans are typically issued by private investors or companies. Hard money is great for real estate, but the ...
How Many Properties Should Have A HELOC When Real Estate Investing With Numerous Properties
There's no one-way to do investments because it is all situational and a matter of personal risk preferences. There's no cookie cutter approach. That being said, most real estate investment portfolios should never have the entire portfolio on HELOCs. ...
The Credit Cards Promotional 0% APR Period is Over – Cancel or Keep Them
Does one want access to more funds? (If yes, keep them open) Will one apply for more 0% interest credit cards? (If yes, keep them open) One can get more 0% APR cards at nerdwallet.com, creditcards.com. Do the current cards have good/great benefits, ...
The Bank Contact Was Different Than The Person / Name Listed
If a bank employee moves to a new bank, gets promoted, demoted, fired – they don’t think about calling us. Instead they move on with their lives like 99.9% of other people do. So the bank list may not be 100% accurate at every moment. These contacts ...
Should Someone Pay The Primary Residence HELOC or Investment Property HELOC First
It always depends on the individual investor and the property in question – primarily what the risk assessment is and if it meets one’s risk standards before investing. There's an emotional decision and then there's a mathematical decision. From an ...
Should Someone Get A Rate Lock For Their Loan
Depends on one's cash flow and the rate lock APR. Use the HELOC calculator to see whether a 0.5% to 1% interest rate increase (i.e. without a rate lock) would still work based on the monthly positive cashflow. If the yearly increase is too much for ...
Don't Banks Want Interest Rates To Go Sky High
No. In fact, banks make more money when interest rates are low. High Federal Reserve interest rates will leave lower margins (i.e. rate of return on investment) for a bank because a 10% interest rate will only allow a bank to charge an extra 1% above ...
Should One Use 0% APR Credit Cards To Pay The HELOC Down
The problem with most 0% APR credit cards is the limits are often quite low. If a card only has a $10K limit, it can only be used for a few months before its maxed out. This can be potentially negative if it is a personal credit card, due to the ...
A Second Lien Position HELOC Save A Little Money Over A First Lien Due to Interest Rates – Why Not Start Here
First, the bank’s balance sheets see second-lien position loans as high risk and are exponentially more likely to issue a freeze or pay in full call on the loan. They have no guarantee of collateral rights (the home) and therefore they cannot ...
When Is A Reverse Mortgage Better Than A HELOC
Only one situation. When a person is elderly, cannot work any longer, has no fixed income of any kind and still has a mortgage with more than 20% of the home’s value still due. The reason for this is simple. The bank cannot approve this person for a ...
When Should Someone Refinance Their Home To Access More Equity in The HELOC
Refinancing is a good option when there is a substantial amount of equity in the home that is currently inaccessible and that liquidity is desired for future investments or emergencies.
After The HELOC Is Paid Off - Can It Be Kept Open As A Line Of Credit Perpetually
Yes, one can keep the HELOC open until the draw period is over, then it will close unless something is still owed at which time time it turns into an amortization period. However, one should never have that occur but rather refinance into another ...
What Is The NMLS Number For This Organization
The Nationwide Multistate Licensing System & Registry (NMLS) is used to license residential mortgage brokers and originators and track their history for public safety purposes. These licenses mean very little to those who are not sponsored by or ...
Can A HELOC Work Like A Reverse Mortgage
Yes, a HELOC allows a homeowner to access the equity paid into their homes just like a reverse mortgage; however, HELOCs do not have the incredibly high fees associated with accessing that liquidity (e.g. $0 to $1,000 for accessing up to $1M in ...
Does The Government Endorse HELOC Programs
No. HELOCs are private bank loans and are not federally regulated. On the other hand, the government does endorse reverse mortgages despite the enormous fees (e.g. $15,000+ for $250K) and hidden clauses that tend to take advantage of the elderly. In ...
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