Why Increase Home Equity Line Of Credit

Let's say that original home value was 200,000 and equity credit line was on 80,000. The value of the home went up to 250,000 - can the home equity line of credit be increase by 50,000?

If so how?

Would appreciate your help guys... and smile!!! )))

Not automatically.

You would probably have to apply for a new loan and have the home re-appraised.

2008-10-27 19:04:03 by smiling_chicka

The rate for a home equity line of credit is generally based on the prime lending rate. Find out how prime rates can increase or decrease on a ...

Line of credit currently at $60,000, but want to increase to $150,000 just in case I ever need it. If I never really use it, does it still affect my credit rating?

If you don't use the loan and manage your money, I think the increased amount can work against you. The credit companies measure your income/or worth against the total credit you are carrying. If you are carrying more credit than you can afford, you are a higher risk. If, on the other hand, you have plenty of income to handle such a high loan, it probably will have no affect until you use it.

2007-10-11 13:26:58 by DRESS

helocs are based off of LTV which come from appraisals... if your are pushing 100% loan to value (LTV) but its been some time since your initial heloc closing, you can used what is called an AVM , computer generated appraisal.

2006-03-30 11:21:02 by 11315646

Hi,
I'm referring to the following case (example):
- property appraised value: $100,000
- current mortgage principal/balance: $50,000

My question is in the example above, if I want to refinance up to 75% and the bank approved it, how does it work TECHNICALLY in most cases:
1. I get a new $75,0000 mortgage instead the current $50,000 mortgage? or:
2. I continue to pay the $50,000 mortgage and get an additional $25,000 Home Equity Line of Credit? or:
3. Other?

THANKS.

1 is the answer. But $50k of the $75k will be used to pay off the loan so you will only walk away with the remainder (less closing costs probably).

2008-10-29 17:41:03 by Independent_guy

My grandfather is getting a equity line of credit for $50,000. Is the 30 year fixed good? Also, should he look into getting an increase and start flipping properties? He owns his house and is done paying payments. He is going to make minor repairs on his house.

Does he realize that the line of credit has to be paid back and his house can be foreclosed upon if he were somehow unable to make payments?

Any fixed rate apr is better than an adjustable. Right now with the way the economy is, flipping properties might not be as equitable as it was.

2009-07-28 11:46:03 by knb901