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Old 07-21-2010, 01:18 PM   #381
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FUEGO, it is really interesting to see how far you and your DW have come since your initial post on this topic. Is it accurate to say you decided not to apply for the HELOC?
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Old 07-21-2010, 02:48 PM   #382
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FUEGO, it is really interesting to see how far you and your DW have come since your initial post on this topic. Is it accurate to say you decided not to apply for the HELOC?
No; we applied for and obtained the HELOC from penfed. I had been wanting to anyway.

I may get lambasted for this from some, but we ended up using a part of the HELOC to pay off the remainder of my parents in law's tiny mortgage so we can transfer their house into our names for "estate planning purposes". Lest anyone get too concerned, the house is worth way more than what we paid on their mortgage (by a factor of 5-6) and the plan is for parents in law and/or BIL (who lives in the house w/ parents) to pay us back over the next ~2 years. And the amount of mortgage debt we "assumed" represents around 4-5% of our net worth, so not a huge deal if somehow we end up getting less than all of it back (plus interest at a percent higher than what we are paying on the HELOC). This goes against my rule to avoid lending to family but is likely a smart move given that we will probably be on the hook to some extent for parents in laws. Flame away at my poor decision!

1/3 to 1/2 of the HELOC is still available if we need to borrow against it for an emergency. Or to pay for part of a car or something (the remainder would come from our savings).
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Old 07-21-2010, 02:57 PM   #383
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No; we applied for and obtained the HELOC from penfed. I had been wanting to anyway.
Ahhh. Same process, different outcome.
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Old 07-22-2010, 08:38 AM   #384
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You are really handling a difficult situation well . I hope it all works out .
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Old 07-22-2010, 08:44 AM   #385
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I also think your DW has risen to the occasion, Fuego, from the early posts where you weren't sure she was on board with confronting a difficult situation. And it is admirable that she is the active voice at least with her mother, being firm about the money handling situation. So the unintended consequence seems to be that your already good marriage might be even stronger.

Hope that the united front also acts as a bucket of cold water to your SIL and BIL's earlier hopes that you and your DW would be there to bail them out financially.

And any plans for your HELOC ?
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Old 07-22-2010, 09:55 AM   #386
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I also think your DW has risen to the occasion, Fuego, from the early posts where you weren't sure she was on board with confronting a difficult situation. And it is admirable that she is the active voice at least with her mother, being firm about the money handling situation. So the unintended consequence seems to be that your already good marriage might be even stronger.
Yes, I'm very glad DW stepped up. In any event, I can't effectively communicate complex issues with her parents due to the language barrier.


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And any plans for your HELOC ?
See a few posts above regarding what I used part of it for. Long term I plan to use it as a liquidity buffer/emergency fund (for me and DW). Up till now I have planned on using a margin loan against my investments for liquidity but that is less certain than a HELOC potentially. And the rates on the HELOC are locked lower than the margin loan rates.
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Old 07-22-2010, 10:33 AM   #387
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What is the fixed rate on you HELOC?

I obtained a HELOC from WFC last week, the rate is Prime+1 (not fixed). They told me that they can give me a fixed but it would be higher than Prime+1.

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Old 07-22-2010, 10:37 AM   #388
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What is the fixed rate on you HELOC?

I obtained a HELOC from WFC last week, the rate is Prime+1 (not fixed). They told me that they can give me a fixed but it would be higher than Prime+1.

mP
Fixed for 5 years at 4.25% from Penfed. Adjustable every 5 years thereafter.

Penfed is offering prime plus zero on their adjustable HELOC right now. And 4.13% fixed for 5 years on their 5 yr adjustable product (like what I have, but the rate is 1/8 of a percent lower).

No fees on any of these products at Penfed.
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Old 07-22-2010, 11:06 AM   #389
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Wow, that is much better than what WFC offered. They claimed that Prime+1 is the best they have. No up front fee, first year no annual fee, $75 per year there after unless you maintain a balance of $20,000 or more. Termination within three years will cost me $300 (they did a formal appraisal which cost them $450). They will loan up to 80% LTV with no fee of loan up to $500,000.

Wonder if Penfed serves California.

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Old 07-22-2010, 01:00 PM   #390
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I can't tell if that is sarcasm...
Definitely not sarcasm. You are handling it admirably.
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Old 07-22-2010, 01:08 PM   #391
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Wow, that is much better than what WFC offered. They claimed that Prime+1 is the best they have. No up front fee, first year no annual fee, $75 per year there after unless you maintain a balance of $20,000 or more. Termination within three years will cost me $300 (they did a formal appraisal which cost them $450). They will loan up to 80% LTV with no fee of loan up to $500,000.

Wonder if Penfed serves California.
You would need to check their website (penfed.org). Or call them. I seem to recall that they have stricter terms for "high appreciation areas" like California (or some counties at least). I believe my max LTV was 75% and I'm in a low growth area.

My HELOC has an early termination penalty of a hundred dollars or so (basically their prepaid closing costs) if you close the line within 3 years. No annual fee though.
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Old 07-22-2010, 01:09 PM   #392
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Definitely not sarcasm. You are handling it admirably.

In that case, thanks!
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Old 07-23-2010, 10:29 AM   #393
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Wow, that is much better than what WFC offered. They claimed that Prime+1 is the best they have. No up front fee, first year no annual fee, $75 per year there after unless you maintain a balance of $20,000 or more. Termination within three years will cost me $300 (they did a formal appraisal which cost them $450). They will loan up to 80% LTV with no fee of loan up to $500,000.

Wonder if Penfed serves California.
All of your terms seem fine except for the yearly annual fee. You might be able to get the annual fee waived by setting up an automatic payment from your checking account.

I have the same 5/5 HELOC from PenFed @ 4.25 and we are in California. As Fuego said, their rate is Prime + 0, but there is a minimum floor of 3.75 no matter how low prime goes, the rate will never be lower than 3.75.

If you search the other posts, you'll see that while this is a great deal, there are some slight differences from a traditional HELOC that you should be aware of. The most significant is that the minimum payment is a percentage of balance (I believe 2%).
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Old 09-29-2010, 02:06 PM   #394
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Thread Update:

Unfortunately no good news to report.

DW, I, and the kids are at the beach for a week on vacation. We had all of the in-laws down for the weekend (including gambling SIL and her husband and MIL and FIL). That's when I got quite an earful from gambling SIL's DH.

SIL has continued the gambling. Going out Saturday-Monday for all-nighters. Hosting occasional gambling parties at her house.

She is in an even worse position than she was in back in April when I started this thread. Her husband says the gambling debt is now up to $20,000 (from $8,000 in April after paying down some gambling debt). That is on top of the $15000 she has borrowed from MIL back in April or May (none of which was repaid). And on top of the thousands she has lost gambling from her paychecks these last 5 months (almost none of her earnings go towards family expenses).

Gambling SIL and husband had worked out a deal that SIL pays for some expenses and husband pays for other expenses. Surprise surprise, gambling SIL couldn't keep up with the payments she was responsible for. The last few months, these bills have gone occasionally unpaid and occasionally paid by SIL's husband.

SIL's husband is understandably fed up and bordering on filing for divorce. Him and I spent a few hours discussing his issues, where he wants to go in life, looking out for the kids, etc. He says he can't go on living like this forever and something has to happen soon. At some point late in the evening, he says he has made his mind up as to what to do. Something is going down soon.
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Old 09-29-2010, 02:11 PM   #395
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I'm sorry Fuego.
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Old 09-29-2010, 02:11 PM   #396
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SIL's husband is understandably fed up and bordering on filing for divorce. Him and I spent a few hours discussing his issues, where he wants to go in life, looking out for the kids, etc. He says he can't go on living like this forever and something has to happen soon. At some point late in the evening, he says he has made his mind up as to what to do. Something is going down soon.
Sadly, this does not sound like it is going to end well. I am sorry to read this.
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Old 09-29-2010, 02:24 PM   #397
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Gambling SIL's DH pointed out that gambling SIL still doesn't acknowledge she has a problem. Her solution is still to gamble and win her way out of her gambling debt and credit card debt (which continues to grow).

Gambling SIL acts as if nothing is wrong, life is going on as usual, and family life is ok. Her DH and her teenage kids say it is quite a different story. Her and DH are essentially separated and have slept in separate rooms for months (but still living under the same roof). SIL, while at the beach, acted perfectly normally around her DH and us. No sign that she is about to lose everything.

This calm demeanor is disturbing to SIL's husband. He says it may come as a shock to the rest of the family (but not his kids) if/when he files for divorce, so he wanted to let someone in the family know the real story in case lines are drawn between different people later (if things get ugly). I told him he has at least one ally, and that others in the fam may not agree with his decisions, but they can't completely ignore the reasoning and causes behind his actions.

Just another example of SIL's depravity and how it impacts her kids: she initially didn't want to come to the beach with us and the rest of the family for the weekend (and bring her kids and let them play). She wanted to stay at home and gamble. And she was willing to make her kids sit at home all weekend instead of allowing them to enjoy the good weather and ocean at a free (to them) oceanfront beach house (we paid for everything). She has already said she isn't coming back down here this weekend because she has to work (to earn money to gamble) and she didn't say it, but she wants to be in town so she can gamble. Just sad.

A few weeks back she had a party at her house solely for the purpose of having gamblers come over and go at it for a few days. Usually she would be inviting her family over too. It was a complete secret from the rest of her family (who all live within 2-3 miles). Now it is a secret because she has already promised she will stop gambling, and she doesn't want anyone to know. At least she took the initiative to isolate all of us from her activities instead of making us look like the bad guys when we have to avoid her and her parties.
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Old 09-29-2010, 02:30 PM   #398
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Unfortunately for all involved it sounds like filing for divorce is the best option available.

Your SIL is a poster child for Einstein's definition of insanity: doing the same thing over and over again and expecting different results.
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Old 09-29-2010, 02:40 PM   #399
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FUEGO, sorry to hear this. Sad and your SIL definitely is compulsive and just can't stop the gambling at all cost.
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Old 09-29-2010, 03:01 PM   #400
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In general, how is this thing handled in a divorce? If he divorces her tomorrow, does he have any responsibility concerning the debts? I'm guessing "no" because they are all illegal and off the books (?)
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