Heloc question

7 Replies

Would most bank allow if you take out a heloc on your primary home and move out in a few months? Example to buy a condo with the heloc and move to the condo for the purpose of down sizing. The primary sfh will be rented out.

Whatever you do after you get a HELOC I doubt the bank will be checking out on you every so often...

In most states there is no primary residence requirement for a HELOC.

From my experience most HELOC loans will have a primary residence requirement but if you currently reside in the residence just get approved then move. Majority of the time they won't care at that point nor will they check. Some banks may offer a VELOC for a vacation home or non primary residence but usually have a higher interest rate but may be worth looking into.

Spoke with a banker and some banks do require proof of residency for 6 months to a year or even more but again all banks will differ. Best to contact the bank that you are getting the loan with and have them lay out their guidelines. 

Once you're approved for the HeLoc the bank does not care how you use it. That's the beauty of a HeLoc. The HeLoc is associated with a certain property whether you live in it or not. If the HeLoc is being paid the bank shouldn't care. 

Don't tell the bank that's your plan. If the bank asks during the application process, it's acceptable to say you're using the HELOC to do home improvements. Once the HELOC funds, then you can do as you wish as others have stated. The bank will stay happy and your move won't be an issue as long as you make your payments on time.

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