Home Equity Lines of Credit (HELOC) is a great tool to maximize your purchasing power if you are putting down less than 20% down on a home and a great alternative to mortgage insurance.
In San Diego County, a loan amount that is in excess of $417,000.00 is considered a high balance loan and a loan amount that is in excess of $546,250.00 is considered a Jumbo loan. The minimum down payment required for a high balance loan is 10%. The benefit of putting down less than 20% is that you get to hang on to more of your savings, but the drawback is mortgage insurance. Additionally, if your net household income is in excess of $100,000.00 a year, your mortgage insurance payment in NOT tax deductible. The Interest that you pay on a Home Equity Line of Credit (that was used to purchase a property) however, is 100% tax deductible. In many cases the minimum payment of a HELOC is less than that of the monthly mortgage insurance.
Most mortgage banks require a minimum down payment of 20% for any loan amount that exceeds $546,250.00. This puts your maximum purchase price at approximately $682,000.00 with a minimum down-payment of $136,250.00.
Used effectively as a “Jumbo Buster” a HELOC will allow you to purchase up to $830,000.00 with a minimum down-payment of 10%, or $83,000.00
A HELOC is a great alternative to mortgage insurance and can allow a buyer to purchase more home with less money down.
I recommend chad because he is not pushy or trying to manipulate as others in the same business, the process was smooth with no obstacles, best team. ”
My wife and I purchased a home in Escondido, first home together. Chad and his team made the whole process extremely easy and helped us close quickly. Will recommend to all friends and family!”
Chad and his team were Awesome to work with! I was referred to Chad by a good friend of mine. I was very impressed with the professionalism and quick response times from Chad Baker & his team during the entire process. I screened over 3 lenders before selecting the Chad Baker Team and I’m confident I made the right choice. It’s obvious that customer service is their #1 priority and it shows. I highly recommend Chad if you have lending needs. ”