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Discussion Starter #1
As I had previously posted, the mortgage rules regarding lending practices by the regulated financial institutions will come in effect on October 31st, 2102. These rules essentially limit the availability of funds through your line of credit to 65% of the value of your home rather than the 80% that is now typically available. While 80% would still be available, any amount provided over 65% would need to have a scheduled payment plan associated with it and not have the option to pay interest only on any amounts borrowed as HELOCS typically do now.

Its not unusual that lenders effected by these rules to implement them earlier than required so don't be surprised to see the changes sooner than October 31st. A HELOC can be extremely useful to:



  • Pay off higher interest dent
  • Have as an emergency fund
  • Do renovations
  • School funding
  • A low interest source of funds for investments

If you are considering a HELOC for up to 80% of the value of your home, or are considering changes to an existing HELOC you may have, it would be wise to do it sooner rather than later.
 

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so if you have it setup up to 80% right now, when changes come your 80% rate will stay the same or they will switch to 65% ?
 

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Discussion Starter #3
so if you have it setup up to 80% right now, when changes come your 80% rate will stay the same or they will switch to 65% ?
existing HELOCS are grandfathered (remain the same). However if you decide to make changes to it the new rules will come into effect.
 
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