Question : How long after buying a home will i be able to take out a home equity loan?
I am wanting to buy my first home and the home i found needs work. I want to take a home equity loan out to make the repairs but i dont know what kind of time frame i will be looking at to get one. Any advice would be much appreciated.
- asked by Kelly
All Answers:
Answer #1
As I understand it, a home equity loan is based onthe amount of equity in your home, therefore, ifyou have only just bought the property presumablythere won't be any equity? The bank will anywaytake into account whether a further loan isaffordable.
- answered by SLF
Answer #2
Well the home equity loan is based on how muchequity there is in the house and your creditscore. If you buy the house and get a loan forlets say 300,000 (put 10% down payment)and and thesurrounding houses go up in price your house wouldincrease its value too (your payments usuallydon't make much of a difference because firstyears you pay mainly interest on a 30 year fullyamortized loan). So if your house becomes around360,000 from original 330,000 then your loan tovalue would be 83.3% with good credit you couldrefinance and get about 20,000 out of your equity.How long this would take depends on the area youare buying at. Right now there are many placessuch as California where the house values areactuelly declining.It is most likely going to takeabout 2 years.
- answered by Tiko
Answer #3
depends on how fast home prices are going up -they are supposed to stay down or flat for atleast the next year or two, so I wouldn't count onany decent equity for at least 5-10 yrs
- answered by Dr. Deth
Answer #4
You won't get an 'equity loan' until you actuallyhave equity in the property. If you take a higherLTV mortgage, your equity will be close to zilch. Lenders are not going to give equity loans whenthere is next to no equity. I suggest that youcontact your local banker to see if you canarrange for a 'construction loan' after youpurchase the property. Bear in mind that, afteryou are done with the needed repairs, the value ofthe house may not meet what you have borrowedagainst it.Unless you get a really hot deal on theoriginal purchase, count on being 'upside down'for a few years down the road.
- answered by acermill
Answer #5
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- answered by James William
Answer #6
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- answered by dama p
Answer #7
You should be able to close a home equity loanwithin 2 to 3 weeks after the application. However there are many factors that can affect thetime it takes to close your home equity loan, andeach loan is different. The following factorshelp keep the closing time frame short:(a) youhave excellent credit score(b) you provide yourloan officer with all the information anddocumentation he needs honestly and quickly(c) your loan officer is efficient(d) the lender hasefficient procedures and technology If you applyfor the additional loan you need from your firstmortgage lender, you should be able to get themoney very quickly since the first mortgage lenderalready has all the necessary information.
- answered by ksb k
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