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Old 10-07-2021, 10:00 AM   #41
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So, based on OldShooter's positive comments, I contacted US Bank about a HELOC. I had talked to them two years ago about a HELOC, and I contacted the person I talked to then. She turned me over to the wealth management person in the local branch, who gave me the pitch on the benefits of their "wealth management" program. I politely demurred, so she agreed to set an appointment to open a checking account and look at the HELOC options.

An hour later I got an email confirming my appointment to discuss wealth management and a long list of benefits for signing up. Oh, and please bring copies of your latest statements so we can review your portfolio and tell you about our current promotions for new clients.

This morning I sent the e-mail cancelling the appointment...the HELOC pricing looks reasonable, but not interested in having to fight off the sales pitch. I looked up their highest tier of wealth management, which is run out of separate offices in a few cities. Just for fun, I looked at the credentials of the account managers. Not one had a degree in business, economics or finance.

Although the branch is nearby, I'm thinking that signing up for a checking account will only allow them to mine my credit report for more information to use to sell me on their other products. Whe knows where else that information will go?

Back to the search for a good HELOC product...
Sorry if I led you astray. My experience was that when they saw our balance sheet we were moved to the "wealth management" group even though we have no assets with USBank. A small positive result was that my Visa got upgraded somehow and I am now getting more points. The sales pitch was a one minute blip. A woman called me and asked if she could help, then started commenting on the day's financial news. It quickly became evident that she didn't know what she was talking about, which I politely pointed out with a couple of questions. I then thanked her for her time and that was the end of the pitches.
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Old 10-07-2021, 10:41 AM   #42
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Sorry if I led you astray. My experience was that when they saw our balance sheet we were moved to the "wealth management" group even though we have no assets with USBank. A small positive result was that my Visa got upgraded somehow and I am now getting more points. The sales pitch was a one minute blip. A woman called me and asked if she could help, then started commenting on the day's financial news. It quickly became evident that she didn't know what she was talking about, which I politely pointed out with a couple of questions. I then thanked her for her time and that was the end of the pitches.
I'm sure every office is different. These folks are clearly sales motivated. Their branch is located adjacent to a large gated retirement community and that probably affects their marketing approach.

I think the average Fidelity person is more sophisticated than these folks, who probably attended more marketing classes than technical ones. And I really wonder if they (and everyone else) aren't mining the credit reports required to open an account to market to new customers.

On to the next candidate!
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Old 10-07-2021, 02:46 PM   #43
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IB margin rates: https://www.interactivebrokers.com/en/index.php?f=46376 1.58% for anything from $1 to $100k. Rates for higher amounts go down from there.
I spoke with Merrill Lynch today and their margin loan interest rates are 5.8%-6.25% depending on the balance so that idea has been nixed. BOA has never been known for their great rates.
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Old 10-08-2021, 07:40 AM   #44
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Schwab has a Pledged Asset Loan with rates around 2.5%, IIRC. Can loan up to 70% of your taxable assets, no way would I go that high since it's basically another margin loan.

From what I've read getting Interactive Brokers margin loan into your cash account takes at least 30 days from account setup and brokerage transfers, they have the cheapest rates by far but will automatically sell assets in a margin call. Not a real issue if your loan is short-term and/or you keep it at 25% or less of assets. No fees, open an IB Pro account for lowest rate.
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Old 10-12-2021, 04:28 PM   #45
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Comparison shopping is the way to go. Some HELOC charge a yearly maintenance fee while other don’t. I like Bank of America because there is no fee to apply and no maintenance fee. The interest rate may be 1/4 % higher but if you sign up for an automatic payment of the monthly minimum, they waive 1/4%. There is also no fee for paying down the HELOC which suit my need when I borrow money against my rental properties to buy equities after a 10% or 15% stock market correction. I then pay back the HELOC balance after the recovery and pocketing the 10% or 15% gain. I do not play this game on my principle house but I do use a HELOC on my principle house to buy more properties because buying properties is less risky than the stock market.
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Old 10-12-2021, 04:31 PM   #46
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You rent in between. Hopefully a home with basement storage. And a lease with a 6 month out.
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Old 10-13-2021, 09:34 AM   #47
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That's an option, but moving twice sucks and your 6-month rent costs more than 12.
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Old 10-13-2021, 04:54 PM   #48
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That's an option, but moving twice sucks and your 6-month rent costs more than 12.

Huh? You pay just the 6 months rent.

But yeah- moving twice sucks, but you do what you have to do.
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Old 10-14-2021, 10:01 PM   #49
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Not much to add to the excellent responses and ideas here, except to say we did this twice in succession (two homes, one after the other). Worked exactly as advertised and our only costs were interest and in the second case, closing the line as well because it was within 3 years and we were selling the home.
It was BoA each time. Their process is klugey and slow but their rates are competitive at least.
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Old 10-15-2021, 10:23 AM   #50
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Huh? You pay just the 6 months rent.

But yeah- moving twice sucks, but you do what you have to do.
6-month leases are usually more expensive than 12. Of course you could always skip out and forfeit the deposit on a 12-month.
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Old 10-15-2021, 04:41 PM   #51
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I got a No Cost HELOC from Third Federal at 2.24%. Well, it's a negative cost HELOC because they gave me a free $100 Home Depot card.
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Old 10-15-2021, 04:48 PM   #52
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On a related note, do they revaluate your house when one gets a HELOC and thus might pay higher taxes?
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Old 10-15-2021, 04:50 PM   #53
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I got a No Cost HELOC from Third Federal at 2.24%. Well, it's a negative cost HELOC because they gave me a free $100 Home Depot card.


Recently? How long did it take? I got mine 2 yrs ago and I think it took about 30 days but I hear they are backed up now but they continue to promote.
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Old 10-15-2021, 04:53 PM   #54
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Recently? How long did it take? I got mine 2 yrs ago and I think it took about 30 days but I hear they are backed up now but they continue to promote.
They took up to almost 60 days now .. I got it early Jan.2021. It was a long wait.
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Old 10-16-2021, 06:18 AM   #55
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Not much to add to the excellent responses and ideas here, except to say we did this twice in succession (two homes, one after the other). Worked exactly as advertised and our only costs were interest and in the second case, closing the line as well because it was within 3 years and we were selling the home.

It was BoA each time. Their process is klugey and slow but their rates are competitive at least.
Im not sure if this is a new requirement on BOA Helocs but you can no longer use the funds to purchase another home. One could argue, just don't tell them the true purpose of the Heloc, but I'd feel uncomfortable doing that. Also their rates on Helocs aren't competetive, even with the loyalty discount.

I'm the OP. We decided to apply for a HELOC which is fixed at 1.99% until the end of 2022. The only cost, aside from interest at draw down, is a $300 fee to close the line, if within 3 years. If all goes well, we will buy our next home, utilizing the HELOC to supplement the all cash offer, put our house on the market immediately and sell at a price within striking distance of the ridiculously high number our broker gave us earlier this week.
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Old 10-16-2021, 08:13 AM   #56
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That's a good rate, where did you get that HELOC?
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Old 10-16-2021, 10:00 AM   #57
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Im not sure if this is a new requirement on BOA Helocs but you can no longer use the funds to purchase another home. One could argue, just don't tell them the true purpose of the Heloc, but I'd feel uncomfortable doing that. Also their rates on Helocs aren't competetive, even with the loyalty discount.
The interest rates are based on the assumption that the HELOC is against your principle home. Borrowing on rental properties are normally 1/2% higher due to the higher risk of a rental property.

However, People would buy the rental property using HELOC money on their principle house but before they rent the new property out, they would apply for a HELOC to another bank and claim that the new property is a newly acquired principle house. The end result are two HELOC with interest rates based on principle home.....and not one on principle property and the other on a rental property which should be 1/2% higher.

I believe some banks have gotten wise to this practice...but not all of them.
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Old 10-16-2021, 07:59 PM   #58
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Im not sure if this is a new requirement on BOA Helocs but you can no longer use the funds to purchase another home. One could argue, just don't tell them the true purpose of the Heloc, but I'd feel uncomfortable doing that. Also their rates on Helocs aren't competetive, even with the loyalty discount.

I'm the OP. We decided to apply for a HELOC which is fixed at 1.99% until the end of 2022. The only cost, aside from interest at draw down, is a $300 fee to close the line, if within 3 years. If all goes well, we will buy our next home, utilizing the HELOC to supplement the all cash offer, put our house on the market immediately and sell at a price within striking distance of the ridiculously high number our broker gave us earlier this week.
I had HELOC with BOA and used it to purchase another home while I was in the process of selling the home where the HELOC was on. It worked out well. There was never a question on how we would use the HELOC. In fact the BOA guy advised us to do it this way.
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Old 10-18-2021, 04:07 PM   #59
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I had HELOC with BOA and used it to purchase another home while I was in the process of selling the home where the HELOC was on. It worked out well. There was never a question on how we would use the HELOC. In fact the BOA guy advised us to do it this way.
Great for you, but not what our BOA guy told us and what DS's BOA guy told him.

When did you do this deal? Perhaps their policy has changed.
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Old 10-19-2021, 10:22 AM   #60
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So OP did you end up with a BoA HELOC this time?
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