Accessing personal home equity.

[Ruben Goodbear Anders]

Hello all! 

I’m looking for some creative advice here, or maybe options I don’t even know I don’t know about. Ya know?

Story short, have 265k loan on my 505k recently appraised house here in Austin. I was going through the refinance process and they were so backlogged (3 month process) that I am now on hiatus at my job. So, my refinance is closing tomorrow, no problem. My heloc that I was planning on accessing 137k is on pause because our DTI would be too high now that I don't have a job, technically.

My heloc loan officer told me they calculated this as if I immediately accessed all of the 137k at the highest interest rate possible. (Variable rate 14% is the cap.) with only my wife’s income (115k, and social security we get for my stepdaughter, 788 a month) the only option my credit union would be able to do is 84k loan. Not heloc. Obviously a huge hit to the amount of available funds. And I don’t like the idea of a loan. 

I’ve done some searching and am coming up empty handed. I am curious if any more seasoned folks know any other loan products out there available to us “self employed with an employed spouse” situations. I would love to access as much equity as possible. I was thinking if there is some options that depending on what you purchase with it would be more lenient. I’m looking to buy a 4-20 unit property, which the cash flow would definitely service the new debt. 

Side note, I’m inquiring how they are calculating our dti, because it doesn’t seem to add up to me. So I will keep this post updated on that calculation. 

I currently only have our new mortgage payment of 1750. One rental property (under 2 years owner ship) at 840 month. Two cars totaling 600 a month. And student loans under my wife’s name that are currently in forbearance but the minimums on them are under 400 a month.

I apologize for the long post, it was just a real gut punch the actual amount of money we’ll be able to access. I had calculated our equity at 80% Ltv at 192k which would give me some serious purchasing power for my experience. However I guess they take the appraised amount, subtract the loan amount first and then calculate the 80% which left us with 137k.  Hoping to cruise through this little roadblock! 

Thank you in advance!