We're in the middle of a refi. We were supposed to be subordinating our HELOC.
The bank that carries our HELOC lowered our credit limit about 6 months ago by $13K, even though our loan:value ratio is still fabulous... we owe just over 50% of appraised value. And even at the full (original) credit limit, we were over $100K under appraised value (even in this depressed market). We didn't have any say in the matter, so we let it go through without fighting it. My mortgage broker just emailed me to tell me that the bank is refusing to subordinate unless we agree to a permanent loan modification reducing the credit limit by another $36K! That means that our credit limit would be almost maxed out! The entire point of subordinating it was to keep it open as an emergency fund! That's the money we use for doing big projects like putting on a new roof! They want to lower it to the point where we won't be able to do anything with it!
I am sooooo pissed right now. If they had bothered to tell me they were going to do this when I originally called them about it, I would have explored getting a new HELOC, rather than planning to subordinate.
Instead they wait until we're already 4 weeks into the process. Not sure what our options are other than to take the offer or to come in with the money to pay them off (which would mean using the money I was planning on using to hire a midwife).
The bank that carries our HELOC lowered our credit limit about 6 months ago by $13K, even though our loan:value ratio is still fabulous... we owe just over 50% of appraised value. And even at the full (original) credit limit, we were over $100K under appraised value (even in this depressed market). We didn't have any say in the matter, so we let it go through without fighting it. My mortgage broker just emailed me to tell me that the bank is refusing to subordinate unless we agree to a permanent loan modification reducing the credit limit by another $36K! That means that our credit limit would be almost maxed out! The entire point of subordinating it was to keep it open as an emergency fund! That's the money we use for doing big projects like putting on a new roof! They want to lower it to the point where we won't be able to do anything with it!
I am sooooo pissed right now. If they had bothered to tell me they were going to do this when I originally called them about it, I would have explored getting a new HELOC, rather than planning to subordinate.
Instead they wait until we're already 4 weeks into the process. Not sure what our options are other than to take the offer or to come in with the money to pay them off (which would mean using the money I was planning on using to hire a midwife).
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