Hard To Get Home Equity Line Of Credit

I am trying to get a Home Equity Line of Credit from my primary Mortgage holder on short notice.
How hard should this be ?
They took my information 2 days ago and said it should be a breeze but now thyere not returning my calls.
My house is worth 399k , I have 165k in equity and am asking for home equity line of credit of just 15,000
This is an emergency situation and i have no one to turn to otherwise.
If they turn me down, how easy is the process with another lender ?
I really need a no doc fast deal.

With the current market problems a no doc loan is almost impossible. If you have a good banking relationship check with them. Bank of America, Chase and Wells Fargo can do equity loans if you have good credit and plenty of equity.

2007-12-12 17:00:34 by Leea

A home equity loan and a home equity line of credit both provide money from the value of your home. But each one has its pros and cons.

Only people who work in lending please answer.

My background:
200K/yr income. Employed for 9 years at the same very large company. I have 25 years experience in this same occupation. I own my home now for 10 years - have a 170K balance on an original $255K loan - I've been making extra $500/month principle payments religiously since I bought it, so I have something like 70% equity in my home even AFTER the recent drops in house value we've seen recently. My current mortgage payment is 1700/mo. My house has a value of $600K from 2009 recent comp sales. I have no cc debt, no car loan debt, no debt of any kind. I have no late payments on any bills ever. I pay for just about everything by credit card but I then pay the bill off every month ($4-5K mo usually). My credit rating is between 790 and 820 depending on the agency you use. I also have verifiable liquid cash and stock accounts in excess of $200K (this is not retirement money, this is after-tax hard cold cash)... so to me, Id say Im a good bet, no?

I recently applied to open a HELOC for 200K and was turned down by Bank of America. They gave me this cryptic explanation "This is no reflection of your credit worthiness, you actually have excellent credit, but you don't have enough trades to meet our internal approval criteria"... I asked for that in english but they wouldn't elaborate or explain what a trade was or how many was enough..only that I didn't have enough. I haven't a clue what that means.

Im shocked that Im not considered a good risk considering I actually don't need the money, so Im turning to this answer board for help... what's wrong with the picture?

It means that your credit card companies are not reporting your history. Since you pay them off each month, you are not really using credit and they do not report it to the credit bureaus. Banks like to see three or more (but not 20) lines of credit and you only have one -- your mortgage.

2009-07-01 16:56:51 by JoeBoy

what's the difference between the two, and which ones are easier/harder to be approved of etc?
My partner is getting one or the other, which I'm strongly urging because he owes me alot of money , due to health problems and house problems I had to help him with, and I personally want him to go with whatever's more flexible, and has a longer time frame, so it will make it easier on him on payments.

He got accepted left and right when he applied for personal loans last year but turned them all down because he didn't need them yet, and this year he's starting again but is going for the home equity, but already got one rejection, because he already has some debt.


I personally don't know what to tell him, so someone educate me!

thanks.

Equity lines are easier because you have collateral - the house. A personal loan is of course possible, but more difficult because you have no collateral.
Equity lines also will have a lower interest rate. If he was rejected on the home equity, then he will most likely be rejected on the personal loan. The new debt would increase his debt to income ratio and Frannie and Freddie's guidelines are more strict due to the subprime bubble burst. Eliminating that debt will lower the debt to income ratio (they generally want less than 45%) and allow a home equity line to be approved if that was the reason for denial.

2009-03-09 20:13:31 by nick cave

My fiance and I found the perfect house, in a perfect area, with the perfect price. It's spacious, which is great, since we have two kids and three dogs (one is a Dane). The house is 82k. My fiance makes 50k/year. I make whatever comes my way doing web design. Our credit scores are in the low 500's. We have no money saved up (this kind of showed up outta the blue). We go see the inside on Monday, and I already know I want this house. We can't get a bank loan, besides our credit, because the house is deemed unlivable. It has no heat (yet) and there is some electricity and carpentry that needs to be done. I have a handy family, so, to me, it doesn't sound like a big deal. However, I don't know on what grounds they are deeming it unlivable. If we go Monday, and it's a wreck upstairs (the downstairs is fine, from what we could see through the windows), we'll say no. If it is something my family can fix, then we'll say heck yeah! I'll live downstairs until the upstairs is done, for all I care. Now, here's the big problem. Like I said, crap credit and no money. My dad can't help, he has his own house and father to care for, my mother has no job, but has pristine credit. My step father has great credit and gets paid a good bit, but he owns three houses, and I was told lenders looked down on that. If we like the house, we're going to talk to my future mother in law's real estate agent. She has crap credit too, but bought her 90k house with no money down. I hate to sit idle, though. I need to know if there is something we can do. I looked at hard money lenders, home equity loans, and home equity lines of credit. I'm buying an ebook tomorrow that gives me access to sub-prime lenders. Is there anything else I can do? Any realty agents on here that might know? We have never gone bankrupt or foreclosed, will I need a Letter of Explanation? If we can't get this house, then we'll build our credit and money for two years and get a manufactured home. We'll put it right in the utopia town we found. But for now, if there is something we can do, I want to do it. I'm not giving up just because I made some stupid mistakes when I was 18. Thank you to everyone who replies to this! Oh, and thanks for reading all that, it was a lot, ha ha!

And I hate that freakin spell checker... It's as bad as that paper clip on Microsoft Word...

One more thing, we would like to be able to get a loan in addition to the mortgage to fix up the house and put a furnace in... or a wood stove.
Wow, awesome responses so far, thanks all. Apparently my score is in the higher 500's. Unfortunately, it's still bad, plus I'm not technically employed. It's my fiance's score that really matters, I think.

We also have a car loan that's all paid on time, so I hope that looks good.

Mrswearing- the furniture idea's a great one. I like buying stuff too haha. I think I'll try that.

Sylvia- you definitely made me feel inspired! I'll check up on that info!

Kemperk- well, what happened was I turned 18 and got cell phone plans and whatnot... I also don't like having a boss, so I couldn't keep a job. That's why I work for myself ;) Members of my family build houses, so depending on what needs to be done, I should be good there.

Thanks again everyone!
Turns out, I have options. FHA can approve the loan if we give them 5% down. That money can come from a relative, as well, as a "gift". Now all we need to do is see the house to see if it's worth it.

Thanks ;)
Oh and to the first person who responded, Sub-prime lenders do still exist, there just aren't many of them. That ebook was worth the 17 bucks. Lol, I'm not that poor.

My boyfriend just bought a house, and while he doesn't have bad credit, he didn't have any money saved up. He went through a first-time home buyer's mortgage company and didn't have to pay a cent down. He started making his mortgages payments a month after he got the key and everything is perfect, got great interest rates, etc.

As far as a second loan for heat and stuff, i doubt you can get one and if you do the interest might be insane. A lot of mortgage companies will finance in certain things like new windows and a heat pump. They offered us new windows but we're paying for it separate. Also, you will get the first time home buyers credit from the IRS if you havent bought a home in the past 3 years. It's 10% of the loan amount up to $8,000. So for an $80,000 house you can get $8,000 from the IRS and not have to pay it back-at all. So check into that too.

Also, if the house is in too bad of shape, you might not get an insurance company to accept you...this is something to think about because even though your offer might be accepted, you might not get things lined up in time to actually buy the house before the contract ends so there are so many things that can go wrong--just be prepared.

2009-06-18 22:17:40 by Eviscia

we have an ARM loan that is prohibitively expensive for our budget and since our appraised value is way underwater, we cannot get a refi. My original lender sold the loan and securitized it so refinancing, especially since we have a home equity line of credit that will not allow itself to be subordinated to another lender that refis the first mortgage only. I really want to tell the lender of our first mortgage that we're between a rock and a hard place and that if they dont play ball, we're going to walk away from the house. am i guaranteed to have a huge black mark on my credit score for just threatening this, or do i have to actually walk away from the house to have such a thing happen. thanks!

If your payments are uncomfortably high, then your credit score may already be low due to your debt load.

And no, you don't get a credit ding simply for asking them to consider a change in your loan terms.

But based on what you've said, you need to forget about your credit score and start focusing first on what's best for YOU and YOUR FAMILY.

Unfortunately, "prohibitively expensive" may mean one thing to you, and something very different to the lender.

There are some servicers who are doing what I call "prophylactic modifications" (see http://foreclosureresolutioncenter.com/b log/2008/07/15/avoid-foreclosure/are-loa n-modifications-an-effective-solution-to -avoid-foreclosure/ ).

However, the failure rate on these appears to be VERY high.

Depending on the servicing agreement, you may have to be delinquent on your payments (a few payments behind) before you'd be allowed to apply for one.

I'm all for trying to save your home, particularly if it means a lot to you. However, I'm also very much in favor of SUSTAINABILITY.

What I mean is this: a lot of homeowners want payment relief, but many of them still end up losing their homes even after they've gotten it.

Most homeowners think, "If I could just get the payments down," or "If I could just get caught up," that everything would be fine.

The industry statistics say that even with the BEST possible terms, the odds are 50/50 that they end up losing the house within the next 24 months.

I'm not saying this to alarm you, I'm telling you this to INFORM you that you need to keep your eye on the ball- a loan modification is not a magic pill, by any means.

It's mission-critical to your long-term survival that you not only get the payments reduced, but that you set up a specific, detailed game plan for the next 12-24 months so you don't find yourself in this position again.

Here's a quick example of what I'm talking about:

http://foreclosureresolutioncenter.com/t est.html

If you'd like to discuss your specifics and plan an *effective* long-term strategy, you can click on the blue "foreclosureresolution" link at my user name, or click on my profile to send me an e-mail.

Best of luck to you.

2008-08-19 17:01:56 by oizuki