Can I obtain a home equity loan or line of credit immediately after purchasing a home in order to pay off credit card bills? The home I am looking at is a short sale & is priced under market value.
Answers | 6
It could be that there are some institutions that may have their own internal overlays that say otherwise, but generally speaking, the answer is "yes". In most cases, an appraisal will not be required and some lenders will even pay your closing costs.
Hope that helps.
If you close a HELOC or second concurrent with the purchase, and you can, owner occupied conventional can go combined or CLTV 89% with that 721 FICO and full doc qualifying.
Seconds are higher rates that firsts, and lenders consider them higher risk because they would need to pay the first in full to foreclose.
All comes down to cost / benefit as always: If your credit card balances and interest rates and minimum payments are high enough, the cost to obtain the HELOC or even refi the existing mortgage under the a refi appraisal, could be easily overcome by what you'll save on credit card payments.