Sorry, I was NOT referring to YOU as thinking you were God’s gift to a Lender…It was a general statement.
I can only determine that after talking to someone who thinks they are special, until I have to tell them that they don’t qualify.
Having an 800 credit score, with high income and only wanting a 50% LTV loan is not a guarantee that someone will qualify.
All of your debt enters into the process, rental properties, insurance & HOA on all properties etc.
Covid caused a problem for some with rental properties because they didn’t have enough reserve assets even though they had huge equity.
Another client could save a lot of money and is qualified & approved for a great interest rate, but his tenants won’t let an appraiser enter the property,
HELOCS are a 2nd lien against a property for the full amount of the line whether any of it is being used or not.
It really shouldn’t matter to a first lender, but the system requires it.
Having a $400,000 1st and a $100,000 HELOC is viewed as $500,000 of debt, rather than just $400,000 and can affect pricing.
Leaving a HELOC in place is possible, but requires a subordination, usually costs at least $250, and wastes several weeks.
It is definitely better to agree to close the HELOC completely and get a new one after the new loan funds.
Lots of ways to save so much money with minimal effort.
Saving a couple of hundred dollars a month is one possibility. but paying that couple of hundred towards principal every month adds up to a much greater amount of compounded savings, guaranteed to pay a mortgage off quicker.
I would not suggest getting serious tax advice here. Talk to a qualified tax advisor. You’re asking some serious questions
