Comments on: Using a HELOC as an Alternative to Refinancing http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html The offbeat personal finance blog for responsible people. Thu, 16 Feb 2012 20:41:50 +0000 hourly 1 http://wordpress.org/?v=3.0.4 By: Carnival of Money Stories No. 94 http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-66 Carnival of Money Stories No. 94 Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-66 [...] Penzo presents Using a HELOC as an Alternative to Refinancing posted at Len [...] [...] Penzo presents Using a HELOC as an Alternative to Refinancing posted at Len [...]

]]> By: Dave http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-67 Dave Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-67 It's a good idea, but with a big caveat. HELOC rates are usually tied to the prime rate, which is about as low as it is ever going to get. My HELOC is currently at 3.5%. Unfortunately, the prime rate can fluctuate a lot. True, even if prime gets to 10%, the monthly interest payment is not going to get to $400, but it's important that your MIL not base her budget on the $100 payment since it has nowhere to go but up. It’s a good idea, but with a big caveat. HELOC rates are usually tied to the prime rate, which is about as low as it is ever going to get. My HELOC is currently at 3.5%. Unfortunately, the prime rate can fluctuate a lot. True, even if prime gets to 10%, the monthly interest payment is not going to get to $400, but it’s important that your MIL not base her budget on the $100 payment since it has nowhere to go but up.

]]> By: Len Penzo http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-68 Len Penzo Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-68 Dave, Good point and I should have mentioned it. I considered the possibility of interest rates getting to a point that would make life uncomfortable for my MIL, and concluded there would be enough options available to us that would allow her to keep her home and reduce her payments. The most drastic being I would simply pay off her HELOC -- which isn't as bad as it sounds since she only owes $40,000 on a house worth $200,000. The interest rates would have to go very high for this to happen. But she is not a loose cannon with regards to spending; she is disciplined and as a result I am confident she will be okay. Len Dave,

Good point and I should have mentioned it.

I considered the possibility of interest rates getting to a point that would make life uncomfortable for my MIL, and concluded there would be enough options available to us that would allow her to keep her home and reduce her payments. The most drastic being I would simply pay off her HELOC — which isn’t as bad as it sounds since she only owes $40,000 on a house worth $200,000. The interest rates would have to go very high for this to happen.

But she is not a loose cannon with regards to spending; she is disciplined and as a result I am confident she will be okay.

Len

]]> By: Mortgage Man http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-69 Mortgage Man Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-69 Very nice. Thanks for this. Very nice. Thanks for this.

]]> By: Refinancing With A HELOC, Lehman Brothers Collapse http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-70 Refinancing With A HELOC, Lehman Brothers Collapse Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-70 [...] Penzo suggests that we can use a HELOC as an alternative to refinancing. He offers a case study that shows you how it can [...] [...] Penzo suggests that we can use a HELOC as an alternative to refinancing. He offers a case study that shows you how it can [...]

]]> By: barrie mortgage http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-71 barrie mortgage Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-71 Just a quick message 2 thx you 4 your interesting post. Do u know where I can find more on the subject? x Just a quick message 2 thx you 4 your interesting post. Do u know where I can find more on the subject? x

]]> By: Home loan modification http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-72 Home loan modification Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-72 The trick is getting the mother-in-law to agree to the reverse mortgage. I have talked to many seniors about the concept of the reverse mortgage - none of them liked the idea of it - they want their home to go to their heirs, not a bank. .-= Home loan modification´s last blog ..<a href="http://www.findingmortgagerates.com" rel="nofollow">mortgage rates</a> =-. The trick is getting the mother-in-law to agree to the reverse mortgage. I have talked to many seniors about the concept of the reverse mortgage – none of them liked the idea of it – they want their home to go to their heirs, not a bank.
.-= Home loan modification´s last blog ..mortgage rates =-.

]]> By: smith@refinance home equity http://lenpenzo.com/blog/id482-using-a-heloc-as-an-alternative-to-refinancing.html#comment-73 smith@refinance home equity Wed, 20 Apr 2011 20:48:56 +0000 http://lenpenzo.com/blog/?p=482#comment-73 Home equity lines of credit or HELOCs, are a popular source of secured credit for people who require loans in small installments. HELOCs help people borrow against home equity. The equity on the house which is determined by having the home appraised, decides the credit limit of the borrower. The choice regarding how to borrow against this built up equity depends on the kind of financing required by the homeowner. .-= smith@refinance home equity´s last blog ..<a href="http://refinancemortgagesinfo.com/refinance-home-equity/home-equity-refinance" rel="nofollow">Home Equity Refinance</a> =-. Home equity lines of credit or HELOCs, are a popular source of secured credit for people who require loans in small installments. HELOCs help people borrow against home equity. The equity on the house which is determined by having the home appraised, decides the credit limit of the borrower. The choice regarding how to borrow against this built up equity depends on the kind of financing required by the homeowner.
.-= smith@refinance home equity´s last blog ..Home Equity Refinance =-.

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