Using a Credit Union with In-House Products

[oorhett]

Been calling a few local "smaller" Credit Unions here in Utah to see what loans they have that I may qualify for. So far found a couple that may work out, thought I would start a thread to document my experience. 

Looking to get a Heloc for $300,000 against a home value of $550,000 with no existing Mortgage. (House needs major renovations, so hoping for no onsite appraisal)

My CH 7 BK discharged Sep 2019

Lots of new credit cards (6) and some older student loans on my credit. 

So far have found two Heloc's that need a score of 660 or better with rates at about 4.25-4.5% 15/20yr amortization. With fees of around $650 plus appraisal if it's needed, and are ok with my BK.

Planning on submitting an application tomorrow after calling a few others. I Will update here with my progress  

[oorhett]

Progress Update: 

1st Lender - America United Federal Credit Union 

• Countered with an offer of $185,0000 4.25%
• Based on a middle score of 663 TU
• The counter was based on DTI (They are including my property tax payments in the DTI calculation!)

2nd Lender - GoldenWest Credit Union 

• Requested a co-signer
• Reasons were BK, Length of established Credit history, to many Inquires (This was pulled after #1 but the same day)
• They only Pulled Experian with a 670 score

3rd Lender - Utah First Credit Union

• Pulled Experian 670 score (Pulled after #2 same day)
• Still waiting on a decision, but the loan officer is confident based on my Credit Report

4th Lender - Freedom Credit Union 

• Have not appd yet

5th Lender - CC Bank 

• Have not appd yet

[oorhett]

3rd Lender - Utah First Credit Union

• Pulled Experian 670 score (Pulled after #2 same day)
• Asked for $300,000 
  • Countered with $185,000 6.25% with 1.99% 12 mo intro rate
  • because the Loan will be in 1st position they want to include an escrow account in my DTI Calculation ($459) and also decided to limit my max loan amount based on an income multiplier
  • Want me to pay upfront for a full appraisal ($400-$600) 
  • I am going to pass on this one as Lender #1 is a much better rate and it's a Drive-by appraisal but I am still looking.

I found two more lenders that have favorable options for me. Also, it seems that $250,000 is turning out to be the magic number for not needing a full appraisal for a Heloc which I am trying to avoid.

One is a smaller Bank "First Community Bank" who is associated with Glacier Bank out of Montana and has branches in Utah and another Local CU that has a 30yr Fixed that claims to be OK with my Chap 7 BK being under two years old.  

[oorhett]

4th Lender - Freedom Credit Union 

• Received a response from this lender claiming that my Experian score came in at 621 and they need it to be 640 or better 
  • Not sure what method they are using for scoring because everyone else has told me 670 for Experian

5th Lender CC Bank 

• Still have not applied here 

6th Lender Granite Credit Union 

• Applied for a regular Cash-out Refinance 30yr Mortgage 
  • They pulled 3 Bureau report which matched Lender #1 used my middle score 663 TU 
• Asked for $300,000 
  • Offered $245,000 Based on my DTI (Adding Escrow account) 
  • 7/1 arm @ 3.125%
  • $5100 Closing cost 
  • Still waiting to see if they ask for a full appraisal or not

7th Lender First Community Bank (Affiliated w/ Glacier Bank) 

• Filled out my Application but they are yet to pull my credit they use only TU
• BK as long as above a 630 score they are ok 
• Suggested that they will use an Interest-only payment amount for DTI 43%
• $250,000 or less does not require full Appraisal
• Rates are 4.75% Qtr, or 5.1-6%3yr fixed or 6+% 5yr
• Costs = lender paid $300-$600

[oorhett]

Have Narrowed it down to three Lenders: 

1st Lender America United CU -  HELOC Asked for $300,000 

• Offered Loan Amount (DTI limited) - $185,000 Pymt = $1145 P/I
• Int Rate - 3.25% Adj
• Closing Costs $0 if I keep the account open for 36 mo
• Appraisal - BPO
• Credit - Pulled Tri Mortgage  EQ - 658, EX - 670, TU - 663 (Using Middle Score 663)

6th Lender Granit CU - 30 yr 7/1 Arm Asked for $300,000

• Offered Loan Amount (DTI Limited) - $245,000 Pymt = $1049 P/I
• Int Rate - 3.125% Adj
• Closing Costs $5100 
• Appraisal - Waiting to see type requested hoping for AVM
• Credit - Pulled Tri Mortgage  EQ - 658, EX - 670, TU - 663 (Using Middle Score 663)

7th Lender First Community Bank/Glacier Bank HELOC asked for $250,000 to avoid full Appraisal

• Offered Loan Amount - $250,000 Pymt = $1062 I/O
• Int Rate - 5.125% 3yr Fixed
• Closing Costs $600
• Appraisal - AVM
• Pulled TU, Score - 663

[Anonymous]

Why in the world do you want an adjustable rate when interest is at the lowest it's been, ever in recorded history? Just get a home equity loan rather than a HELOC.

If you don't pay off $200k+ by the first adjustment period I can all but guarantee you it will adjust HEAVILY upwards and your payment will go into the stratosphere.

[oorhett]

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@Anonymous wrote:

Why in the world do you want an adjustable rate when interest is at the lowest it's been, ever in recorded history? Just get a home equity loan rather than a HELOC.

If you don't pay off $200k+ by the first adjustment period I can all but guarantee you it will adjust HEAVILY upwards and your payment will go into the stratosphere.

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Thanks for your reply and suggestion! I am limited to what options I have due to my Chapter 7 BK discharge only 18 months ago, and need to avoid a full appraisal on the home due to the current condition that it is in. Another factor is that I will most likely only use $75,000 of the whole amount, yet there is a possibility we will end up using the other $225,000 for a potential home purchase in December. So making payments on the full $250,000 from the outset seems like the wrong thing to do here. If you are aware of any Home Equity Loans that would serve me better I would appreciate the info. 

[oorhett]

Update on my progress:

1st Lender  America United CU - They called today to let me know I am Approved and Cleared to Close

- (Keeping this option open in case #7 fails for some reason)

- AVM/BPO Appraisal

- This was a pretty painless process not a ton of communication, however no issues to resolve: title, credit, or otherwise "Really wish they would have been able to give me the full $250K that I needed" 

6th Lender - Granite Credit Union - Still in underwriting with a few conditions still that are needed

- Copy of my two most recent NFCU Credit Card statements, sign an IRS form and from there they will let me know additional conditions

- AVM/BPO Appraisal

- Loan officer called me with title issues so referred him to another Title Co that seems to have cleared up those concerns  

7th Lender - First Community Bank / Glacier Bank  - (Plan to close on this Loan this week, thought I was closing Feb 26th "Title issue")

- According to the Loan officer we are now Clear to Close but he hasn't called me to schedule, he suggested Mar 4/5th. 

- AVM/BPO Appraisal - The loan officer had to drive by and take a couple of exterior photos I didn't even know they were there.

- Had an issue with Title thinking a pre-BK Judgment was a Lien on my Post BK Property, took me calling directly to get them sorted out. 

I Will update again,  hopefully closing this week!

[kaylord84]

Any update ???

[oorhett]

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@kaylord84 wrote:

Any update ???

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Yes, it got delayed due to the title issues, scheduled to close this Friday!