HELOC on Jointly Held Property

[Alan Chin]

My mother and I jointly hold a property that is completely paid off where she currently lives. My mother was planning on doing a HELOC on this jointly owned property so that she can pay off one of her rental properties. I am in the process of house hunting for a primary residence with my wife and was wondering if a HELOC on our jointly held property will hinder my wife and my ability to get a loan for our first primary residence purchase. I assume that since my mother is taking a HELOC in her name only that it doesn't affect my debt/credit ratio but I've heard varying things. Her lender says it won't affect my ability to get a loan and my current lender says that it will since the property is held jointly in my name.

Who's correct and what will be the impact if my mother pursues this route?