Can I qualify for HELOC - no job, good assets

Question

Greetings;

I need a short-term (1 year?) loan of about $40k - would only pull what I need when I need it (not all at once - but  a bank won't know that) - and am thinking a HELOC would be the easiest, but:

I am not 'working' - haven't really worked in a few years - am technically 'self-employed' but . .

The HELOC would be on my primary residence:  a mobile home - current value @$130k (conservative), owned free and clear.

I have a rental property that brings in @ $1000/mo; the rental is owned free and clear; current value @$140k

I have no outstanding debt - except my CCs which I pay in full every month;

Current credit (fico) score of @ 730 - (just below that magical 739 due to a 'blip' that has been removed) - otherwise I've Never been below 760!

Strong $$ assets (401k, IRAs) -(how much info do I really want to give away?)

Will this be 'doable' via bank/CU HELOC?  Recommendations?

I have called a couple banks and they all want to know my "income" - which is basically the rent I receive and capital gains when I run low.  How do I 'package' this to convince a lender I'm a 'no/low-risk' borrower?

Thanks so much

Kelly

Leanne H. · Answer

@Kelly G. Strange, I didn't receive a reply in my inbox, but just read what you said to Scott about giving up on the loan. :( Sorry to hear about that. Guess I'm probably out of luck too.

Kelly G. · Answer

@Leanne Huynh - I think you sent me a pm and I replied to that

@Scott Schultz  the house is a manufactured  (mobile) in Colorado and no - I don't have much/any income on my 1040; kinda living off retirement/investments for now.  I kinda gave up on the loan and am just using my savings - hope to get the house back on the market soon and make a tidy profit.  I'm lucky to have the resources though I hate to tap them.

Thanks for the in put and good luck in all your endeavors

Kelly

Scott Schultz · Answer

before depreciation, do you have income on your 1040? if so that may be enough, probably not a traditional HELOC, but a line of credit secured by real estate, small local banks may do them especially on the commercial side against your rental property.

otherwise check with Stu at Athas Capital, he may beable to do something for you, he is a non traditional lender.

Leanne H. · Answer

Hey Kelly,

I'm in the same boat with not 'working' but with rental properties and needing about 30k.  Great credit score. I pay all my CCs in full. I'm curious if you were able to get a HELOC loan.  Thanks!

Kelly G. · Answer

Thanks @Alexander Felice and @Bob Rowe

Yeah - I'm 'house rich' and 'cash poor' - so to speak;  I just don't want to tap any more of my retirement savings.  I plan on selling my RV to cover about 1/2 of the HELOC - but can't really wait for the $$.

Rent checks are made payable to me. Thing is . .  the rental is in WI, my home is in CO, and my CU of 20+ years is in FL! I have no 'local' bank/CU that I have/am doing business with.  Guess it's time to change that.

Thanks for your comments

Kelly

Bob Rowe · Answer

Sounds to me like you are "self-employed" and your job is a "property manager".    The DTI guidelines would be hard to meet if there is no assurance that any income would be consistent into the future.   Are rent checks written directly to you?  I would check with a local bank/credit union that you have a relationship with.   They will be more flexible.

Good luck.

Alexander Felice · Answer

What is the average of the last 2 years of income on your taxes.

That is how they will determine if you can pay for the mortgage.

You aren't a low risk borrower: you want a variable rate note on a mobile home and have no job. That's usually a HARD PASS for banks. That said, if your returns meet DTI guidelines you'll probably be fine, just gotta get in front of lender who will work it out.