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advice re paying off HELOC after sale of house

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Anonymous
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advice re paying off HELOC after sale of house

Hi, I'm new to the forum, so any and all advice is appreciated. 
 
After suffering well over a year of poor commissions in my job, I placed my house on this distressed housing market nine months ago and now have a contract on my house.
 
The problem is I have a HELOC with CitiMortgage.  Once the sale is completed on my home, I will still owe about $26,000 on my HELOC. 
 
I do NOT want a short sale as I am still able to pay on this loan, and of course I will have more than sufficient money to pay off the HELOC earlier without a mortgage payment and associated housing expenses.
 
The only bad mark on my credit right now is a 30-day late pay to a department store.  I have a lot of credit, but my credit is good except for that score.  I have sent a letter to the department store asking them to remove that negative mark on my credit.
 
It sounds to me that I need a refi -- or do I?  I mean, I have to do something because the house will no longer be equity on that loan.  And will having a balance on this loan have any affect on the sale of my house?   Because title can't be released to the new buyers, can it?
 
When I called CitiMortgage many months ago for a payoff figure, they said I did not have a HELOC, that I could still keep this line of credit open.
 
Well, my statements say plain as day I have a HELOC, and that was my understanding when I got this loan over three years ago.  My real estate agent's assistant said CM only told me that because they "don't want me to pay off my loan."
 
Advice, anyone?
 
Thank you!
 
 
Message 1 of 7
6 REPLIES 6
MidnightVoice
Super Contributor

Re: advice re paying off HELOC after sale of house

All I know is that my CU HELOC requires I pay it off from the proceeds of the sale of my house - I checked a couple of months ago
The slide from grace is really more like gliding
And I've found the trick is not to stop the sliding
But to find a graceful way of staying slid
Message 2 of 7
Anonymous
Not applicable

Re: advice re paying off HELOC after sale of house

Well, I placed a call to CitiMortgage, and sure enough, no "refi."  They say I'd have to take out a personal loan at a higher interest rate to pay off the difference or do a short sale.
Message 3 of 7
ShanetheMortgageMan
Super Contributor

Re: advice re paying off HELOC after sale of house



angel4pets wrote:
Well, I placed a call to CitiMortgage, and sure enough, no "refi."  They say I'd have to take out a personal loan at a higher interest rate to pay off the difference or do a short sale.

That sounds about right... I'd press them to just convert any unpaid balance to an unsecured loan though, without requiring you to apply for a new one.
Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 4 of 7
Anonymous
Not applicable

Re: advice re paying off HELOC after sale of house

No can do - since the HELOC is secured by the house, if you sell, it has to be paid off.  Otherwise you can't release the lein and give clear title to the seller.
 
You'll have to either get an unsecured loan to pay it off or otherwise figure out a way to pay it.
 
Message 5 of 7
Anonymous
Not applicable

Re: advice re paying off HELOC after sale of house

Thanks, guys. 
 
I'm pretty upset that I talked to someone in the summer at CitiMortgage about this and obviously she didn't know what she was talking about.  Well, at least I found got the real scoop a month in advance of my closing as opposed to the week before.  Still have to do some serious scrambling, though, to come up with that money if I can't get an unsecured loan. 
 
 
Message 6 of 7
ShanetheMortgageMan
Super Contributor

Re: advice re paying off HELOC after sale of house

Can you borrow against a retirement account (401k, etc.) or from family?  Prosper.com is a good source too.
Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 7 of 7
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