Cons of getting denied for a HELOC?

[Mack Lev]

Alright, so I have a rental property owned free and clear, and I want to use a HELOC (preferrably from a credit union [PenFed to be exact]) in that property to go out and fund other RE deals. The problem working against me is that Im only 21, so my credit history is barely short of 4 years.

I have a good track record and everything. Payments on time, credit utilization rate at 31% (could be better), nothing has gone to a debt collection agency, etc.. I know the history of my credit is a huge factor working against me in getting approved so i wanted to know what were the cons of being denied.

I know I would probably have to wait 2-4 months before asking again, but are there any other negative implications that come with being denied. Because getting denied and having to wait to ask again is horrible enough as it is, but if it comes with anything else then .... wow.

Also, does getting denied show up on your credit report? I guess thats one of the things I need to find out along with anything else.

And I know that another solution would be to have somebody that trusts me and is more establish to cosign the HELOC with me, but thats kinda major to ask of someone. Even with a good relationship. And if i were to have someone more qualified than me to cosign it could they be removed giving them peace of mind?

Thanks in advance BP community

-Mack

[Matt M.]

Are you employed? I assume you are. They should look at that along with your score. If they won't do it, find another CU or bank that will.

[Marcus Auerbach]

you should be able to discuss your concerns with your bank or CU before they pull your credit. They should be able to tell you what they can do for you. Not sure why you are looking for a HELOC and not for a refi? They will still have to pull it later to make sure it is what you had told them. I would also suggest to speak with a number of lenders, not just one, and shop arround for who has the best deal for you. And remember banks are in the business of selling loans and you are the customer and not someone asking for a favor.

[Mack Lev]

Originally posted by @Matt M.:

Are you employed? I assume you are. They should look at that along with your score. If they won't do it, find another CU or bank that will.

 Yeah. 4 years at UPS. Pretty good. But my question was the repercussions or drawbacks of getting denied

[Mike Hanneman]

There are no repercussions for being denied a loan per say, You might take a slight ding when the bank does the credit check/pull. I have never seen anything on my reports, and I pull them often, about being denied.