Home |
Search |
Today's Posts |
#1
|
|||
|
|||
Need advice about home equity loan. Help!!!
I bought a home about 10 years ago for $63,000. I have about $24,000
in equity in the house. I would like to get a home equity loan for about $15,000 so that I can get some badly needed home improvements. I plan on moving in the next couple of years (probably sooner). I was planning to use my equity in the home to pay off the loan if I have to. Do banks require that you pay off a home equity loan before you sell a house? What should I look out for? I shouldn't have any problem using the money I get from the sale of the house to pay off the loan, should I? I was thinking about getting a home equity line of credit. Do I have to worry about getting a variable rate since the rates are low? Do I need a lawyer for a $15,000 loan? I don't want to refinance because I don't plan on living in my house long enough to make the closing cost worth it. I desperately need work done on my roof and porch though. Any advice will be appreciated. Thank You, |
#2
|
|||
|
|||
Andrew,
Great advice. I was wondering if it is possible to get a home equity loan, then in a couple of months refinance both loans as interest only? For example, my principle is 370K I plan on getting a 30K equity loan. Then in a couple of months I want to refinance both loans into a 425K (appraised value) interest only loan. Let me know |
#3
|
|||
|
|||
wrote...
I was wondering if it is possible to get a home equity loan, then in a couple of months refinance both loans as interest only? For example, my principle is 370K I plan on getting a 30K equity loan. Then in a couple of months I want to refinance both loans into a 425K (appraised value) interest only loan. WHY?!? You will likely pay fees for the HE loan, then pay fees again for the refi. In the end you will have debt of $425K instead of $370K, cash on hand of $55K less all those fees, and the prospect of a huge balloon payment somewhere in the future. In addition, you will pay the interest on the money for the HE loan while you have it, plus you will have to pay it off for the big refi. That will increase the stated APR by a significant amount. What will all this refinancing get you?!? |
#5
|
|||
|
|||
Thanks for the quick reply...Well two reasons first I may need money
fairly quickly for another RE transaction, secondly I want to make my property more attractive for a protential rental. Mortgage is around 2560..need mortgage around 1800 to support rental rates in the area. |
#6
|
|||
|
|||
In article .com,
says... Thanks for the quick reply...Well two reasons first I may need money fairly quickly for another RE transaction, secondly I want to make my property more attractive for a protential rental. Mortgage is around 2560..need mortgage around 1800 to support rental rates in the area. Interest only seems to be gaining popularity for rental homes. Assuming you meet your cash flow, you're simply never paying down the loan to build equity. You'd still get any equity from appreciation, or of course you could go way underwater if a price bubble in your market bursts. Despite current claims, real estate can go down in price rather dramatically, especially if prices have been driven up by speculative excess, near-zero interest rates, and rapidly growing debt levels. (Referring to Japan in the 1990s, though it does sound a bit like here and now.) -- is Joshua Putnam http://www.phred.org/~josh/ Updated Bicycle Touring Books List: http://www.phred.org/~josh/bike/tourbooks.html |
Reply |
Thread Tools | Search this Thread |
Display Modes | |
|
|
Similar Threads | ||||
Thread | Forum | |||
Risk Management/Shop Safety and Advice (long) | Woodworking | |||
Old Man Winter Will Hit Us Tonight! | Home Repair | |||
Home HVAC question.... | Home Repair | |||
buying a home with a new garage and no permit -- need help fast please | Home Repair |