smskeypad

Articles

Print Email

Home Equity Line of Credit

Let La Loma assist you in obtaining an affordable home equity line of credit. With a home equity line of credit, you have the flexibility to make large purchases – such as a new car or truck, recreational vehicle, your dream vacation, or home improvements! It could, also, be your answer to debt consolidation or college expenses!!

The home equity line of credit is an open end, variable rate loan, secured by a deed of trust against your real property. La Loma offers this program on your primary residence or second home (no rental properties or manufactured homes). The amount of your credit line depends on the amount of equity you have in your home. It makes good financial sense using your home as collateral since the interest on your home equity loan may be tax deductible (see your tax advisor). La Loma will only take position as first or second mortgage lien holder.

Home Equity Line of Credit features include:

  • Loan amounts up to $125,000
  • $300 application fee – Can be waived if initial loan advance is $7,000 or more and you maintain a $1,000 balance the first 12 months. Application fee is due when the application is submitted.
  • Maximum loan term of 15 years
  • 5 year draw period
  • Variable interest rate tied to the Prime Rate published in the Wall Street Journal – interest rate is scheduled to change semi-annually (February & August). Minimum interest rate is 5%, Maximum interest rate is 18%
  • $1,000 initial advance minimum; $500 minimum advance thereafter- 6 advances allowed per year

Rates are as follows:

Loan to Value 70% 80%
Level A Prime - 0.5% Prime + 0%
Level B Prime + 1% Prime + 2%
Level C Prime + 3% Prime + 4%
Level D Prime + 5% Not offered
Maximum Credit Limit $125,000 $125,000

The following formula will give you an estimate on available equity in your home:

Current estimated value of your home $
Multiply this amount by the percentage
(70% and 80%)
X
%
=
Subtract all mortgages & liens owed -
This equals the estimated home equity available =

Member Checklist of Documents to include with your Application:

  • Last mortgage statement from your existing home loan lender & any other mortgage balances you may owe. The statement should include name, address, and account number of your mortgage company.
  • Copy of current hazard/fire insurance policy (must list La Loma FCU as loss payee prior to loan funding & maintain throughout loan term).
  • Copy of current flood insurance, if applicable (must list La Loma FCU as loss payee prior to loan funding & maintain throughout loan term).
  • Attached Confidential Information Statement
  • Income Verification – last 2 paycheck stubs (if self-employed, most recent years tax return)
  • Copy of 1st mortgage note to verify loan product type (Fixed or ARM)