Things to keep in mind when applying for a HELOC!
I have been in the process of getting my HELOC straightened out for the Leominster house. I have had a few hiccups come up that I am in the process of squaring away, and wanted to share a few things I have learned in the past 24hrs if they could help anyone out there!
💳 Ask your lender very early on how many "tradelines" that they require. Tradelines are essentially just lines of credit. I was just told a month into the process that the bank "forgot" to check something in my files, and that I have 4 tradelines, but one of them does not count. This drastically affects the max LTV (Loan to Value) that the bank will give you on your equity. I was told that I can open another credit card, and it will take a month to go into effect and count as a tradeline on my credit.
📄 HELOC applications can be open for a good amount of time! This may depend from bank to bank, but the bank that I am going through has a maximum of 3 months that your app. is allowed be open. The reason I mention that, is that when your application is approved, the countdown starts then. Like any traditional loan (especially for real estate lol) it takes a while to get through the paperwork, but if there is an error or something you need to fix, you might have multiple months to be able to fix it WITHOUT closing the application. I was chatting with a very established investor in our space about this yesterday, and he mentioned that closing the entire application to fix a few things could be a bad idea for when you try to open it up fresh again. It should not be your first choice to just close the app. because you have already made it this far into the process. You may be able to fix the issues that came up in the allotted amount of time way before the approved application expires!
🤔 Always respectfully push back on the valuation that they give you if you need to, as well the amount of the line that they are offering. If you believe that you should be able to get a higher line and have comps to back it up, always challenge it and do not just take the first amount they give you, it may be very worth your while 🙂
What are some tips that you guys have for opening HELOC's?
Happy Friday Y’all!! 😁
•
•
•
•
#kcreatewealthtogether #realestateinvesting #realestateinvestor #wealthbuilding #househack #househacking #massrealestate #massachusetts #realestateboston #retireearly #passiveincomestream #incomestreams #investinyou #brrrr #sidehustles #sidehustleideas #incomeoppurtunities #househacking #asset #podcast #smallbusinessmarketing #airbnb #solopreneurlife #investing #startabusiness #ceomindset #entrepreneurialspirit #ownyourownbusiness #incomeoppurtunities #bostonrealestate
#5 Multi-Family and Apartment Investing Contributor
- Investor
- Shelton, WA
- 6,800
- Votes |
- 6,529
- Posts
#5 Multi-Family and Apartment Investing Contributor
- Investor
- Shelton, WA
I like to always have a HELOC on the shelf If I need it. I have one now that has been available for about 5 years. I just noticed it when on line the other day. It costs nothing if I don't use it. Always arrange money when you don't need it.