Home Equity Line of Credit
You can access your home's equity like a credit card. Close in days not weeks, get approved in minutes!Home Equity Line of Credit in Florida
Florida has seen a meteoric rise in home values over the past 15 years! Some who have bought even in the last 2 or 3 years have substantial equity trapped in their home. A home equity line of credit could be the answer to access that equity! People often confuse a line of credit with a home equity loan. Home equity loans are a fixed second mortgage, with a set loan amount and repayment plan. A home equity line of credit or a HELOC acts more like a credit card or a revolving account. You can use the funds, pay the funds back, and use the funds again. This can be done over and over! Additionally a HELOC can close much faster than a traditional mortgage or a home equity loan.
We do home equity lines of credit up to $400,000, with a minimum of $25,000.
How Much Equity Can I Get Out?
As a broker we have multiple outlets for home equity lines of credit in Florida. We give you personal representation on your behalf with the best lending partner for your needs. Our favorite partner allows for a max combined loan to value of 80%. Combined loan to value or CLTV means the first mortgage and the second mortgage can be no more than 80% of the value of your home. For example if your home is worth $400,000 and your first mortgage balance is at $200,000 then the max home equity line of credit would be $120,000, since a combined loan amount of the two would be $320,000. $320,000 is 80% of the value of the home at $400,000.
How Quick Can I Close?
This is the fun part. We can get you closed in days, not weeks. These programs use algorithms to determine eligibility, but when the computer gets in the way human intervention is possible! Plaid is used to analyze deposits for w-2 borrowers and self employed borrowers if deposits are going into a personal account. If not then we can use tax returns to qualify! An automated valuation model is used to determine value, AVM for short. This provides you an instant figure for value, but for $160 a human can take a deeper dive into value if you think your home is worth more! The flexibility of the hybrid digital and human platform gives our program the competitive edge.
What is the Minimum Credit Score Required?
Our home equity line of credit in Florida works for primary residences, second homes, and investment properties. The minimum score for a primary residence is a 640. For investment properties and second homes the minimum score is 700. Keep in mind with a lower score you are capped on your combined loan to value. With a 640 you are capped at 65%. At a 660 you are capped at 70%, at 680 the cap is 75% and at 700 the cap is 80%. For second homes the max you can get out is 75% with a score of 740. On investment properties the max you can get out is 70% of the combined loan to value.
Can You Pay Debt Off At Closing To Qualify?
Not all home equity lines of credit in Florida allow you to pay debt off at closing but with our program you can! Often times this can mean the difference between being able to close and not. The max debt to income ratio is 50%. That means that your total monthly debt that would report to the credit bureaus can not exceed 50% of your income. Rates are slightly better if you can keep your total debt ratio under 45% but its great to have the option of going higher.
Things To Love About Our HELOC
Qualification is based on a soft credit check! So there’s no hard inquiry until you accept the offering. There are no pre-payment penalties for our home equity line of credit. You are required to disperse a minimum of 75% of your requested line of credit amount at closing, but you can turn right back around pay this back to your line the very next day if you so wish! When you close your funds get deposited within hours! You can even fund on a Saturday!
Home Equity Line of Credit Rates
Rates vary based on credit score, combined loan to value, and the purpose for the home equity line of credit. Purposes can be home improvement which has no rate hit, debt consolidation with a .25% rate increase, and “other” which has a .75% rate increase. Home equity lines of credit are rarely fixed, a variable rate is most common. Ours is based off of the Wallstreet Journal Prime index which is currently at 8.5%, then we add the appropriate margin based on credit score, CLTV, and property type. Margins range from 2.49% to 7%.
Key Points to Know for a Home Equity Line of Credit in Florida
- Our program is a 5 year interest only draw period, with payments calculated based on a 25 year amortization.
- Eligible properties are single family homes, condo’s, PUDs, and townhomes, Ineligible properties include manufactured homes and log cabins.
- No pre-payment penalties.
- You do not have to have a first mortgage, this can be a first or second mortgage! If you bought with cash this program can work as soon as your deed is recorded!
- If denied you can re-apply when ready.
- 640 min credit score, to get the max available funds you need a 700, we use the FICO 8 scoring model which is oftentimes more favorable than your typical mortgage credit score!
- You can pay debt at closing to qualify!
A Few More Restrictions to Keep in Mind
- More than one mortgage late in the last 12 months is not allowed, bankruptcies must be 4 years from discharge or dismissal, no charge offs or short sales in the last 4 years.
- Max collection amounts allow within the last 24 months can’t total more than $2,000, if collections are older than 24 months the max balance is $2,500 per occurrence.
- Judgements or tax liens must be paid at closing.
- Max DTI of 50%
- Income can be calculated multiple ways but Plaid is the easiest and quickest! It verifies deposits into your personal account whether employed or self employed.
- The minimum loan amount is $25,000, and the max is $400,000 and you must draw 75% at closing, but this can be repaid anytime!
- Get pre-approved with a soft credit check! You only get a hard inquiry upon accepting the offer!
“Keith here, if you have any questions about our HELOC program feel free to reach out directly, otherwise I would encourage you to use the link below to fill out the online loan app to see what we can offer. If we have any questions for you or if we need to intervene in the application process we will certainly reach out! Our goal is to give you the ease of digital speed but with a personal touch. Remember this is a soft credit check and it will not impact your credit score, a hard credit inquiry is only done once you accept the offer. These things move quick! So get ready!”
Keith Meredith- Division President of Black Rock Mortgage
