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Good HELOC rate for Texas
Old 02-21-2017, 06:52 PM   #1
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Good HELOC rate for Texas

We're not retired yet, and was planning to get a HELOC just before to allow flexibility of cash flow through any market downturns, but a colleague pointed out to me last week that it's a good idea to always have one just in case you have an unplanned employment lapse to avoid penalized 401k withdrawals. Makes sense.

So I've been looking around and it looks like I can get 4.6% through my current mortgage company, with a 10 year draw period and a 20 year payback period. Is this a good rate for Texas?
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Old 02-21-2017, 09:53 PM   #2
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We are thinking the same thoughts as you, with plans to retire at end of July.

Today, we closed on a 200K HELOC with BoA. We are in TN, but rate is national and based on WSJ prime (currently 3.75%), with various discounts for "platinum honors status," auto pay, and 10 basis points for each 10K that we draw out at closing (max of 100K), and keep out for 3 months. So, for $625 interest (at "special bonus rate for first year), we get approximately 1.2% discount from WSJ prime once we start drawing. 10 year draw period, then lock in for a 20 year repayment (by which time we expect to have sold the property).

worth looking at, particularly since the only cost is going to be the $625 interest on the 100K three month draw. All closing/appraisal costs eaten by BoA.
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