There are various forms available for lines of credit. Individuals involved in any aspects of a line of credit have had many questions throughout the process. Uncertainties of what the advantages of a home equity line of credit are or if a surviving spouse can still draw funds from a line of credit after their spouse dies often lead to questions like the ones answered below by Experts.
Case Details: Line of credit is $28,000 with an interest rate of 5.75%. Credit card is $17,000 with an interest rate of 9.96%.
If you would like to save the most money then you should pay off the credit card balance first. You would be saving 4.21% in interest per year by paying of the credit card. The line of credit has a smaller interest rate therefor hold on to that one.
Obtaining a home equity line of credit can be a good idea. Home equity lines of credit can in some case fare better than refinancing the main mortgage. An advantage to getting an equity line of credit instead of refinancing is a low to no closing cost. You can also utilize a line of credit similar to a credit card, as you pay down the balance you can reuse the money again. Interest payments on a line of credit are generally tax deductible just like with a regular mortgage. The main disadvantage to getting an equity line of credit is that you are borrowing against the equity in your home. If you cannot make the payments on the equity line of credit you home is in jeopardy of foreclosure.
Case Details: Both the mortgage equity line of credit equal more than the house is worth. Both have low interest rates, but the Line of Credit (LOC) has a lower one.
Even though the Home Equity Line of Credit (HELOC) may have a lower interest rate it is typically wiser to pay it down for good chances for a refinance. The HELOC being paid down will free up more equity in your home as well as reduce the monthly drain on your cash flow. Freeing up more equity in your home will make qualifying for the refinance a bit sooner and quite possible allow for a lower interest rate on your mortgage.
Just because the individual has been turned down by the more traditional routes does not mean that all hope is lost. Housing Urban Development (HUD) has a program called 203(k) that is geared toward home improvements that will allow the individual to stay in their current home. There are many lenders that work with individuals with the HUD program. These lenders know that the HUD 203(K) program is typically for those that have a hardship that’s why it is a different route than someone’s traditional lenders with whom the individual was denied.
Case Details: The line of credit on the house is not fully drawn on.
If married individuals jointly sign a line of credit on their house and one of them dies then the surviving spouse would still have access to that line of credit. The surviving spouse being on that line of credit before the death of their spouse can still draw funds from the line of credit account.
Gathering good information and having a clear understanding about a line of credit can help when faced with circumstances regarding lines of credit. Experts can help answer if it is more beneficial to pay off a line a credit versus a credit card or if a surviving spouse can still draw on a home equity line of credit. Get the answers fast and affordably by asking an Expert.
Please let me know if you can answer ...........
Question for RAKHI VASAVADA only : I bought my first home(Townhome) in USA just 2.5 yrs ago by taking a home loan or mortgage from a bank and just paid 5% cash down & rest home loan. The total agreed price of home at the time of home mortgage deal was $267000 and as of today my home mortgage stands at $240000 to pay and today’s market price of the same home is expected approx. $300000 or higher . Please guide me about the below : (1) Can I now take Home Equity Loan or Home Equity Line of Credit Card and will the interest payable be deductible as itemized in my Income Tax Return as I do for interest on home mortgage ? (2) Will there be any fee for getting Home Equity Loan or Home Equity Line of Credit Card as there is Origination Fee charged for Home Loan or Mortgage Application Process ? (3) Will the current valuation of home be necessary if we apply for Home Equity Loan or Home Equity Line of Credit Card ? Who will pay for valuation fees – Bank or me ? (4) I have been regularly paying monthly instalment of my home mortgage since end of 2012 and I know that my monthly home loan instalment includes $150 for Mortgage Insurance Premium each month and I can ask to remove it if I get 20% equity share on the basis of current valuation of my home . Please guide me if I should apply at the same time for the removal of mortgage insurance premium from my monthly instalment & apply for new home equity loan or home equity line of credit card because I think that current valuation of home will be necessary for both the applications i.e., Application for mortgage insurance removal & Application for new home equity loan /home equity line of credit card ?
So I opened up this and you can answer what was pending and provide some new ideas.. Definitely most welcome!
Just an update, the RBS card you had in the list changed to Citizens bank, no idea if the same, easier or harder now.