Some lenders online offer generous loans to borrowers searching for solutions to lower mortgage payments. These lenders may offer low interest rates and low monthly installments to borrowers; thus helping them find recourse for mortgaging. The concept of equity loans is to help borrowers find a way to consolidate their debts, purchase new vehicles, remodel homes, or payoff tuition. While these are all big expenses, taking out a personal loan may not be of advantageous, except if the borrower is remodeling the home to build equity. Thus, if this is the goal, you may want to read material to help you save cost in home improvement, and take out a personal loan for a couple thousand to help you meet the costs of the remodeling expenses.
Once you have made the improvements and are still considering home equity loans, you may receive a better offer, since the value of your home increases with each repair and structural upgrade made on the home. Of course, you should be aware that remodeling requires charges for permits and increased taxes and so forth.
Finally, when searching for home equity loans or even personal loans, going online is the best choice for most borrowers, since calculators, quotes and reading material is available to help them compare differences in loans.
Destro
June 15, 2009 at 9:42 am
yes, sir!!!
God Bless California!
see:http://www.stimmel-law.com/articles/CA_AntiDeficiency_Statue_ProtHomeOwnMonJudge.html
Ron L
June 15, 2009 at 9:48 am
To the best of my knowledge, there is no limit. However, thanks to competition, anyone charging anything too unreasonable would quickly be out of business. That and some laws against loan sharking I believe.
The interest of the loan is usually decided by several factors: size of the loan, credit score and current interest rates set forth by the Fed.
eyezman1
June 15, 2009 at 9:34 pm
Read the loan documents. Generally non-recourse instruments must expressly state they are non-recourse.
Richard V
June 16, 2009 at 1:49 pm
Ok, technically it goes like this, after 90 days they send out a Notice of default and if he does not bring payment current/workout something with lender, they'll file a Trustee Sale date and he receives a Letter stating the date the property is going for auction. Therefore due to the mess there are some "lucky" people that don't received this Notice of Default months and months into not paying their mortgages. i definitely suggest he short sales his property rather than just "let it go". letting it go = foreclosure and that ruins his credit. Having a short sale processed will not affect his credit as bad, and if he can show the lender9s) he used to have money etc and not now there's not a reason they would not allow a short sale.
haydaz300
June 16, 2009 at 10:31 pm
Bad idea to put that credit card debt on your house. If you default on the credit cards, you get bad credit. Default on the home equity loan, and you lose your house.
Instead, make a strict budget. Eliminate all the extras — cell phone, eating out, new clothes, etc. Put every penny you can squeeze out of the budget on the highest interest rate credit card, while making minimum payment on the rest. When the highest rate is paid off, move to the next, till they are all paid in full.
If you don't think you can do that by yourself, check into credit counseling: http://www.nfcc.org/. These are legit, non-profit companies that offer debt management programs for a nominal fee. They negotiate lower interest and payments so that you can pay off your debt.
While in the program, it is noted on your credit file but upon completion that notation is removed and you will have decent credit.
Beth
June 18, 2009 at 12:32 am
Regardless of your mother's income, she can save money by paying off her credit cards with a home equity loan or a home equity line of credit. You said her interest rate is 22%? That is ridiculous. With 350k of home equity (the value of her home), she can get a much lower interest rate to pay off her debt.'
And there is a very good chance the interest she pays on a home equity loan may be tax deductible (which the credit card interest isn't).
I say this all the time and I'll say it now. Your mother needs to find a mortgage professional she can trust and have them run the numbers on a home equity loan/line of credit. She will be shocked at how much she'll save over keeping her debt on her credit cards. I can't think of any reason to do so, even her low income. Just find someone she likes and can trust and I can't see how she can go wrong.
Tim
June 18, 2009 at 1:17 am
I am a licensed real estate broker in CA specializing in short sales. I don't know about Kansas, but if the HELOC on the CA primary was a purchase money second, then they cannot do anything but issue a 1099. However, if it was a cash out refi and you used the money to buy a BMW, then they have a right to pursue you for the balance owed.
That said, the truth of the matter is that your lenders wrote off the debt and sold the debt to these third party debt collectors who bought the debt at a discount. Obviously you are not in a position to pay them, so let them know that you are insolvent and unable to pay nor do you have any assets. Do not pay a dime. You can request that all their communication be in written form. Eventually, the statue of limitations will expire on these debts and you will be rid of them. The worst they can do is to take you to court and if they win, get a judgement against you. But I doubt that will happen. If it does, then maybe bankruptcy might be an option.
Here's an interesting website about unsecured credit card debt:
http://www.thecreditcardsolution.com
maybe the rules apply to this stuation as well.
Good Luck
finale 28
June 18, 2009 at 2:04 am
Here's the real problem you are going to have. You will buy a house that is very close to it's real value. It will be cheaper because it is in poor condition.
You need money to bring the condition of the property up to bring it's value up. The bank won't lend on 'future value' or 'future condition' because they have no way of guaranteeing that you'll put the money into the house.
If the house is worth $250,000 and you have a mortgage out for $225,000 (90%), they aren't going to lend you very much. From the bank's point of view they aren't going to lend you another $75,000 (exceeding the value of the house by $50,000) because you could take that $75,000 and, essentially dissapear.
The other issue that you may have is that home values are still dropping in CA. If you bought a house today for $300,000 and waited a year to get a home equity loan, your house might only be worth $270,000, making it tough to borrow money from it.
One way to do it is to improve it very slowly and start with the things that you can afford on top of your mortgage payments. Do it all yourself (learn how to do it right). After a few minor projects you may have improved it enough to increase it's value.
If that is too slow, another (very, very risky) way to do it would be to borrow the money on a credit card, do the improvements and hope that the completed project would appraise high enough to get that equity loan and pay your credit cards off with the equity loan (not, not, not recommending that you actually do that).
good luck!
also home equity lenders are no longer going up to 100% of the value like they used to do. They want you to have some 'skin in the game' so to speak – a financial incentive and anchor to the house.
veronica.tung
June 18, 2009 at 5:56 am
Unfortunately then you will join the ranks of those that have or are losing their homes. No credit, no income and no equity means pay for what you signed for. Sorry but not my fault you overextended yourself, buying way more than you could afford. Do not think my tax dollars should bail you out because of your foolish dreams, and not living in reality.