Home equity loan

Financial Planning - Financial planning in general. (Moderated) 

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Subject Author Date Home equity loan Alpha83 09-30-2007  Re: Home equity loan joetaxpayer 09-30-2007  Re: Home equity loan kastnna 10-01-2007  Re: Home equity loan joetaxpayer 10-01-2007  Re: Home equity loan kastnna 10-01-2007
Posted by Alpha83 on September 30, 2007, 7:06 pm A friend of mine recently lost his job - he owns a home and it has some equity on it. Can he apply now for a home equity loan and tap into that for some cash or is this possible only if you have a job. Posted by joetaxpayer on September 30, 2007, 8:51 pm Alpha83 wrote: > A friend of mine recently lost his job - he owns a home and it has > some equity on it. Can he apply now for a home equity loan and tap > into that for some cash or is this possible only if you have a job. It depends on his credit rating (FICO score), amount of equity in the house, and bank he chooses. This is why the advice here is often repeated: To line up the HELOC while things are good. It's easy to get credit when you don't need it. JOE Posted by kastnna on October 1, 2007, 2:09 pm Would you give money to someone that currently has no way of repaying the loan? I wouldn't. Mortgage officers use debt to income ratios as a basis for loan approval (among other things). An income ratio of zero pretty much kills your chances. Perhaps if he can convince the mortgage officer that he has multiple job prospects lined up, he'll have a chance, but don't count on it. High FICO scores and spousal income (if applicable) will help. Posted by joetaxpayer on October 1, 2007, 2:30 pm kastnna wrote: > Would you give money to someone that currently has no way of repaying > the loan? I wouldn't. > > Mortgage officers use debt to income ratios as a basis for loan > approval (among other things). An income ratio of zero pretty much > kills your chances. Perhaps if he can convince the mortgage officer > that he has multiple job prospects lined up, he'll have a chance, but > don't count on it. High FICO scores and spousal income (if applicable) > will help. So to repeat a bit of advice for others: there's value in setting up a HELOC when you are able, both due to income and equity in the home. There's a perfect world where one always has the emergency fund to bridge gaps between jobs, but that's not possible for everyone. A new roof or new transmission can kill that account for those who tried. And let's not forget, a 401(k) loan isn't an option for most people who lose their job. JOE Posted by kastnna on October 1, 2007, 9:22 pm > So to repeat a bit of advice for others: there's value in setting up a > HELOC when you are able, both due to income and equity in the home. > There's a perfect world where one always has the emergency fund to > bridge gaps between jobs, but that's not possible for everyone. A new > roof or new transmission can kill that account for those who tried. And > let's not forget, a 401(k) loan isn't an option for most people who lose > their job. > > JOE Agreed. The worst plan is no plan and most HELOCs cost less than $50/ yr. to keep open. At this point, there's not many options. Perhaps a friend or family member can help out for the time being. Similar Threads Posted Vehicle Loan vs Home Equity Loan April 23, 2007, 1:35 pm Mortgage or Equity loan from home own outright January 10, 2008, 3:25 pm Home equity line of credit = good investment? March 3, 2007, 3:20 pm Home loan advise needed March 2, 2007, 5:04 am Re: Home loan interest Calculation April 30, 2007, 8:32 am 1st time shopping for a Home Loan: What do I look for??? June 14, 2007, 4:59 am Equity Premium January 1, 2007, 6:02 am Equity returns since 12/31/1999 April 18, 2007, 2:17 pm What to pay off first--student loan vs. car loan April 7, 2007, 6:37 am Large percent changes on stockholders equity section of 10K November 11, 2008, 5:04 am