HELOC refinance

[Anonymous]

My wife and I are looking to increase the HELOC we have on our home to give us a little wiggle room for an addition we are doing.  The current HELOC is at 75% ltv when our home was appraised in January.  I know, we should have just gone to 80% right then and there.  Now that we do want to go to 80% and it's been more than 3 months the bank wants to re-appraise.  My wife's big concern is that our appraised value will drop, our ltv ratio will go above 80% and the bank will reduce our current HELOC amount.  Does this type of thing happen?  We've only drawn on about 60% of the available HELOC so there's room for the bank to cut it on us.  It's a local bank not a national if that matters.  Thanks for anyone's thoughts on this.

[ShanetheMortgageMan]

It could very well happen, HELOC limits can be reduced pretty much at any time... and for years many homeowners in states with sinking home values have seen their HELOC limits get slashed.  You'd have to ask your loan officer to find some inside information to be sure.

[Jazzzy]

I agree...it certainly could happen.

If you have two different appraisers do the same home (even at the same time), you will very likely get two different numbers. Appraising is a combination of art and science. It's much more than just doing the math.

Property values are still going down in some areas. I would be tempted to leave well enough alone.