We are shopping around and did get approved for a $250,000 HELOC with a 8.25% interest rate. Is this a good rate? I mean compared to a credit card it is (owe $3,000 at 16% interest) but how about as a Line of credit?
2007-01-25 01:59:16 · 2 answers · asked by KathyS 7 in Business & Finance ➔ Personal Finance
8.25 is the going rate for a HELOC however if you check around some banks usually have a special for the first few months. But is a HELOC what you are really looking for? Are you aware that HELOCs have variable rates? At the bank I work for the ceiling is 16%. If it is just a one time loan secured by property that you are looking for and not a line of credit then I would recommend a Home Equity Fixed Loan. This is still a loan secured by your house however your rate is fixed and is usually lower. For instance the max loan term on a Home Equity Fixed Loan or (HEFIX) is 20 years. For $250,000.00 at our rate for 20 years is as low as 7.52% and that would bring your payment to around $2,017.17 a month. The main thing you need to remember is that a HELOC is not a fixed rate and I have had people in my office that have had low rate HELOCs but as soon as the rates began to climb so did their loan rates. Also some banks do not charge an application fee or closing costs on their Home Equity loans but some do so shop around because thats an important thing to do with so many options out there.
2007-01-25 02:25:45 · answer #1 · answered by Answerman84 2 · 2⤊ 0⤋
8.25 is a decent rate. The low rates right now are around 6.0%. 250,000 is a lot of equity. are you sure that you are not try to get too much? That might be why you are not getting the loan.
Good Luck
2007-01-25 02:04:26 · answer #2 · answered by Shmesh 3 · 0⤊ 0⤋