What is a Heloc explained by California Home Loan Expert Teresa Tims | So Cal Mortgage Broker

What is a Heloc explained by California Home Loan Expert Teresa Tims | So Cal Mortgage Broker

  • By Teresa Tims
  • August 29, 2019

TheSoCalLoanPro.com with California's most Trusted Mortgage BrokerTheSoCalLoanPro.com with California's most Trusted Mortgage BrokerSouthern California a Home Loan Expert,  Teresa Tims at TheSoCalLoanPro.com with California’s most Trusted Mortgage Broker .  What is Home Equity Line of Credit or HELOC? Need some cash and want to know what’s the best way to get a 2nd Mortgage or Heloc? Watch this video to get all of these questions answered.

What is a Heloc?

Home Equity Line of Credit or HELOC

It’s called a heloc because the value adjusts on how much you access at any giving time that way the payment is adjustable in nature. A 2nd Mortgage is a fixed loan just like the Heloc and works the same but does not adjust so you would get a 30k loan and get the cash all at once.


How Do They Work?

Full credit qualifying loans
Usually they only take a couple weeks to apply and fund
Good idea is to find out if a Heloc vs 2nd Mortgage vs Cash Out Refi makes the most sense and we can help you with that. Call us at 909-920-3500


Are they Fixed or Adjustable
Which is better?

Rate: I am seeing 5-7% pretty regularly for interest rates

Term: Typically 10-15-20 years but if a large loan amount could be 30 years
Loan to Value (LTV) is 80% across the board
Max amount you can access IE “what’s the maximum Loan vs the appraised value or LTV

Example: 100K appraised value | 50K Existing Loan | if 20% of the equity has to stay in the house in this example you can only get 30K
80k minus existing loan of 50K = 30k THAT’S WHAT YOU CAN GET A HELOC

Where do you get one?
I find that banks and credit unions are good sources

Ways to compare with lenders
Watch the video

Is it ok to run my credit 2-3 times

What are the pitfalls
Conservative value is low appraisal

CASE Study
What it looked like when I shopped for a heloc on my Owner Occupied property in Rancho Cucamonga. Current Value 725k Owe 500k so 80% value is 580 can access 80K

Values came back like this!!!
Union Bank 640K
B of A 710K
US Bank 675


TDR MORTGAGE Can access u to 90% of your value with a combo loan IE 75/15/5 75% 1st 15% second or 80/10/10


Teresa’s Top Tips when shopping for a HELOC


  1. Values are going a little, so secure a heloc now?
  2. “IF” you want cash out down the road For home improvements OR DEBT CONSOLIDATION but are not quite ready GET A HOME EQUITY LINE NOW WHILE VALUES ARE HIGH JUST IN CASE!!
  3. If you want an Equity Line and not sure where to start call me I would love to help, I can’t do them unless it’s combined with a 1st but I am happy to point you in the right direction.
  4. Sometimes it’s better to cash out instead of a Heloc – let me help you figure it out.
  5. Home Equity lines only go up to 80% of your value, if you don’t have enough equity we can help you go to 90% of your value.


About Author: Teresa Tims

Teresa Tims is President of TDR Mortgage in Charming Downtown Upland CA. She prides herself in offering quality home loan products, competitive pricing and knowledgeable assistance when helping her clients select a home loan. Teresa is a life-long resident of the Inland Empire. Read More