What happens to an HELOC after you sell your home?

[Anonymous]

Not that I have one, just wondering. Does the bank close it since now it is unsecured?

[MidnightVoice]

---

ilovepizza wrote:
Not that I have one, just wondering. Does the bank close it since now it is unsecured?

---

Normally you have to pay it off as part of selling the house, so it is closed

[Anonymous]

No bank would keep it open, since it is a secured loan.  When you sell the property, you must satisfy all secured loans.  Either pay them off (most of the time) or get the lender to agree to a short sale where they accept less than they are owed in return for considering the loan "satisfied".

But it would be closed by the lender, zero balance and will report for 10 years from date of last activity.

[Anonymous]

Thanks this info will come in handy later. If interest is low better to go with unsecured LOC then. But interest is never low on unsecured credit. Haha.