90/10 LTV HELOC?

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Topic Author
Count of Notre Dame
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90/10 LTV HELOC?

Post by Count of Notre Dame » Fri Sep 06, 2019 1:54 pm

Do any banks offer a HELOC as a secondary lien for the 80 to 90% portion of the value of your home? I originally wanted a 10% down mortgage, but my bank required 20% at the time and I couldn't find a good rate. Rates seem to be very low right now, are there any products out there with a good rate around prime or even less?

batpot
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Re: 90/10 LTV HELOC?

Post by batpot » Fri Sep 06, 2019 3:37 pm

Count of Notre Dame wrote:
Fri Sep 06, 2019 1:54 pm
Do any banks offer a HELOC as a secondary lien for the 80 to 90% portion of the value of your home? I originally wanted a 10% down mortgage, but my bank required 20% at the time and I couldn't find a good rate. Rates seem to be very low right now, are there any products out there with a good rate around prime or even less?
Do you want cash out?
HELOC = Home Equity Line of Credit
I'm confused by your statement that "rates are very low right now" as HELOCS are variable, and will increase as prime does. They are also significantly higher, after any promo rate, than a fixed rate mortgage loan would be, so doesn't make any sense to use the proceeds from a HELOC to pay down your primary mortgage.

Are you looking for a 90/10 Refi, or a 90% LTV HELOC?

Miguelito
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Re: 90/10 LTV HELOC?

Post by Miguelito » Fri Sep 06, 2019 7:53 pm

batpot wrote:
Fri Sep 06, 2019 3:37 pm
Do you want cash out?
HELOC = Home Equity Line of Credit
I'm confused by your statement that "rates are very low right now" as HELOCS are variable, and will increase as prime does. They are also significantly higher, after any promo rate, than a fixed rate mortgage loan would be, so doesn't make any sense to use the proceeds from a HELOC to pay down your primary mortgage.

Are you looking for a 90/10 Refi, or a 90% LTV HELOC?
I understand the OP as wanting cash out. OP indicated desire to only put down 10% but being "forced" to put 20%. Looks like OP is hoping to free up that 2nd 10% that was put down as down payment.

Topic Author
Count of Notre Dame
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Re: 90/10 LTV HELOC?

Post by Count of Notre Dame » Sat Sep 07, 2019 10:46 am

That's correct - looking to cash out. I borrowed $200k from my mother and I feel obligated to pay her back quickly, although the loan with her is interest free.

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whodidntante
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Re: 90/10 LTV HELOC?

Post by whodidntante » Mon Sep 09, 2019 9:47 pm

Count of Notre Dame wrote:
Sat Sep 07, 2019 10:46 am
That's correct - looking to cash out. I borrowed $200k from my mother and I feel obligated to pay her back quickly, although the loan with her is interest free.
Not for her. She owes tax on imputed interest.

rascott
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Re: 90/10 LTV HELOC?

Post by rascott » Mon Sep 09, 2019 10:25 pm

Count of Notre Dame wrote:
Fri Sep 06, 2019 1:54 pm
Do any banks offer a HELOC as a secondary lien for the 80 to 90% portion of the value of your home? I originally wanted a 10% down mortgage, but my bank required 20% at the time and I couldn't find a good rate. Rates seem to be very low right now, are there any products out there with a good rate around prime or even less?
Penfed will do a 80/10/10 loan with the HELOC at 10%

Topic Author
Count of Notre Dame
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Re: 90/10 LTV HELOC?

Post by Count of Notre Dame » Mon Sep 09, 2019 10:28 pm

Stickler.

$120k would count under the annual gift tax exclusion - $15k x my two parents x 4 family members.

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whodidntante
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Re: 90/10 LTV HELOC?

Post by whodidntante » Mon Sep 09, 2019 10:36 pm

I moved a few states away and put my house up for sale in a warm-hot market. Unfortunately, it was overpriced, because I thought the real estate agent knew better than I did. So it took a while to sell. Most of my money was in retirement accounts and I didn't have enough for another 20% down payment, realistically. So I asked the bank if they would issue me a loan with no PMI. The bank said, "sure, no problem! We'll just do a HELOC and if you need more cash use this HELOC credit card thingy." They even volunteered that I qualified for a larger loan than I had asked for.

So I had three mortgages and a new job. You can probably guess which end of the financial crisis this was on. Fortunately, I didn't get caught with my pants down like so many did. Very lucky on my part.

Call and ask.

Clarice
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Re: 90/10 LTV HELOC?

Post by Clarice » Tue Sep 10, 2019 6:35 pm

rascott wrote:
Mon Sep 09, 2019 10:25 pm
Count of Notre Dame wrote:
Fri Sep 06, 2019 1:54 pm
Do any banks offer a HELOC as a secondary lien for the 80 to 90% portion of the value of your home? I originally wanted a 10% down mortgage, but my bank required 20% at the time and I couldn't find a good rate. Rates seem to be very low right now, are there any products out there with a good rate around prime or even less?
Penfed will do a 80/10/10 loan with the HELOC at 10%
I don’t understand the point of the complication. If I’m the lender, why not just jack up the interest rate on the one mortgage? Is it cuz the HELOC has different collateral than the mortgage? I wonder how the figure out the exposure combo they’re willing to take....

rascott
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Re: 90/10 LTV HELOC?

Post by rascott » Tue Sep 10, 2019 7:29 pm

Count of Notre Dame wrote:
Sat Sep 07, 2019 10:46 am
That's correct - looking to cash out. I borrowed $200k from my mother and I feel obligated to pay her back quickly, although the loan with her is interest free.
Sorry I misread your post.... you want to keep your first mortgage and just get a 10% HELOC.... yes many banks will do a HELOC up to 90% LTV.... just call around. Unless you are in Texas, they have some weird laws regarding HELOCs

rascott
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Re: 90/10 LTV HELOC?

Post by rascott » Tue Sep 10, 2019 7:30 pm

Clarice wrote:
Tue Sep 10, 2019 6:35 pm
rascott wrote:
Mon Sep 09, 2019 10:25 pm
Count of Notre Dame wrote:
Fri Sep 06, 2019 1:54 pm
Do any banks offer a HELOC as a secondary lien for the 80 to 90% portion of the value of your home? I originally wanted a 10% down mortgage, but my bank required 20% at the time and I couldn't find a good rate. Rates seem to be very low right now, are there any products out there with a good rate around prime or even less?
Penfed will do a 80/10/10 loan with the HELOC at 10%
I don’t understand the point of the complication. If I’m the lender, why not just jack up the interest rate on the one mortgage? Is it cuz the HELOC has different collateral than the mortgage? I wonder how the figure out the exposure combo they’re willing to take....

Because it often makes sense for the buyer... they can quickly pay down a HELOC (and draw on it again, if needed). Once you pay down your 1st mortgage, you can't access the liquidity again.

Topic Author
Count of Notre Dame
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Re: 90/10 LTV HELOC?

Post by Count of Notre Dame » Sun Sep 15, 2019 9:43 am

Found a HELOC currently @ 4.8% with BBVA Compass. They will go up to 90% LTV, pending the appraisal.

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