Third Federal HELOC?

Question

I am currently evaluating various HELOC products for BRRRR purposes and i am curious if anyone has used this HELOC product?

https://www.thirdfederal.com/borrowing/home-equity...

Prime -1.01% variable (4.49% currently) seems incredible (almost too good to be true) given everyone in my area (eastern washington) seems to want 5.5%-8.5%

I appreciate any input!

Jack Martin · Answer

I have an existing HELOC through Third Federal. It is currently at around 4.5%. It started as a 10 year interest only $317 per month. After 10 years it now is amortizing on a 10 year schedule meaning that the payment is now $1700 per month. Looking to get out of it now. So that's about right, they will qualify you using normal qualification methods. This is for an Owner occupied property so make sure they know that it is an investment property.

Brian Barbuscia · Answer

Well shoot, after more research it seems that my prior 2 years tax returns will most likely kill my chances of getting approved for a heloc of such an amount. Back to the drawing board.

Brian Barbuscia · Answer

Thank you for taking the time to share your information Jack! The property i will be getting the HELOC on is my owner occupied primary residence, so we are good there. My intent is to keep living in my current home. Ill use the HELOC to obtain my first BRRRR project.

I'd like to secure a 150k HELOC from them. My LTV and credit should be sufficient (approx. CMA assessed value 330k-340k, owe 137k) (Creditscore 772) the only potential hangup i could see is DTI restritctions, which i didn't see a limit listed for. Last year my AGI was 44k and one year prior was 33k. I am on track to make 64k this year but as i understand it most lenders assess your income based on 2 yrs prior tax return averages. My only debt is my current mortgage at 972/mo.

Do you recall any DTI limits? if i am not eligible for that 150k i would like to figure out what i am eligible for and strategize accordingly.