HELOC vs Home Equity Loan vs Other Products

[ksJoe]

I have been throwing every bit of cash. I have coming in at the HELOC and just not holding any significant cash reserves and just transferring money as I need it from the HELOC.

Keep in mind, if the market changes banks have been known to freeze HELOCs with or without legal justification. You can lose access to your LOC in an instant with no warning. Then you're left with no reserves and no LOC.

 

[Buckly]

I never liked HELOC’s. It’s a revolving type credit that you use, pay off, use, on and on. Some people find themselves in perpetual debt this way just like credit cards. Since you don’t have a current mortgage you can take out a Home equity loan or a convention mortgage. Whichever has the lowest interest rates

 

[GMan5465]

I asked about that with a couple lenders and since we don't currently have a mortgage, they didn't offer it as an option. Basically I am not refinancing anything. It did make me start to wonder if they push products as they are told by the brass. Everyone came back around to a home equity loan and didn't want to discuss other options. It is the main reason I asked about HELOC here, I couldn't get much info out of them.

I misspoke when I said a refinance. We had paid our house off earlier. I told them I wanted to pull my equity out in the form of a mortgage. When they asked me why, I just told them with the rates the way they are, I wanted to take advantage of it, and that I would be using the money on an investment. It’s backed by the house so they really shouldn’t care. I’d asked them specifically why that isn’t an option. It’s no different than if you bought a new place.

 

[T-Max]

I misspoke when I said a refinance. We had paid our house off earlier. I told them I wanted to pull my equity out in the form of a mortgage. When they asked me why, I just told them with the rates the way they are, I wanted to take advantage of it, and that I would be using the money on an investment. It’s backed by the house so they really shouldn’t care. I’d asked them specifically why that isn’t an option. It’s no different than if you bought a new place.

I think that is a home equity loan, which was an option. There is a cash out refinance where you refinance for more than you owe and cash out the rest. We are on the same page now.

 

[gjs4]

My banker told me a heloc is the cheapest money for land currently. Land loans require a healthy down payment and the rate is very high

I mentioned earlier i wasnt going to say too much....but this is it. While not for everyone, this has been a powerful tool for me