how do you know if you are quilified for a equity loan.I know we have equity in our home and in the past I have always been told "sorry you are not quilified for anequity loan but we can refinance your home".I know that the lender makes alot more off a refi,but does it have something to do with credit scores?If a person has alot of equity in their home why not be able to just get that kind of loan instead of a refi?Or is it all about the lender making more money?
2007-01-22 10:28:32 · 6 answers · asked by Bobbie 4 in Business & Finance ➔ Renting & Real Estate
Your problem may have to do with what lender you are asking the question.
If you go to a lender that specializes in refi. They want to do a refi.
If you to the lender that specializes in Heloc they will want to give you that. If your home has been on the market for sale in the last year, you may have trouble getting the Home equity line of credit.
Best of luck to you,
2007-01-22 10:33:15 · answer #1 · answered by Anonymous · 0⤊ 0⤋
It is not about the lender making more money on a refi - it is based on your middle credit score. Normally a HELOC takes a very good credit of 680 + That is why they suggested your doing a cash-out refinance and taking out some of your equity. You could go FHA, still get a great rate and take out some of your equity. Do you need the full 100 percent? Take out 8-=90 percent and have good rate, fixed for 30 years. You could also do a stand alone 2nd (it is like a HELOC) but you have the same closing costs associated with a first mortgage. It all comes back to credit.
2007-01-22 17:59:26 · answer #2 · answered by W. E 5 · 0⤊ 0⤋
There are many factors that could be effecting your situation. First you are ging to have to have enough equity. Lenders oftten want to see a good margin of equity after you take the loan and costs out of the home. You May not be asking for enough money. Most equity lines ask that you take a minimum amount out with the closing of the loan. This amountis often 40K or more. Your credit may also be efffecting thier decision. Equity lines are like secured credit cards with great rates. Most lenders require very high credit scores to draw an equity loan, if yours is lower then you will need to have even more equity than others. The final piece of the puzzle is income. Equity lines work very similar to mortgages when income is considered. You will have to have enough income to make the payments on the mortgage and the equity loan to qualify. If you go to a good broker, they will be able to show you all of your options.
2007-01-22 10:44:58 · answer #3 · answered by Ron B 3 · 0⤊ 0⤋
It could be both or neither. Some states may not allow a second deed of trust. That would be state law. With that said there is very little money to be maid in a second trust deed in most cases. It also is dependent upon your scores, the capacity to pay (debt to income ratio) since second trust deed are at a much higher rate. And last but not least the collateral. You say you have equity in the home- Fannie Mae Freddie Mac only allow cash out to 90% of the value with a 660 score or better. I will need more info to answer your question properly.
I am a Mortgage banker in Tennessee.
2007-01-22 10:37:02 · answer #4 · answered by golferwhoworks 7 · 0⤊ 0⤋
The following site has a free quote feature for home equity loans. That way you can see what you actually qualify for and you won't have someone pushing you toward a refinance loan
2007-01-22 10:44:45 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Equity loans have tougher guidelines
2007-01-22 10:43:03 · answer #6 · answered by Anonymous · 0⤊ 0⤋