Join Early Retirement Today
Thread Tools Search this Thread Display Modes
HELOC: solo vs joint; disadvantages vs advantages
Old 04-29-2017, 01:33 PM   #1
Dryer sheet aficionado
Join Date: Jul 2016
Posts: 33
HELOC: solo vs joint; disadvantages vs advantages

We just became debt free with a paid off mortgage; home worth $425K, joint ownership. Upon having our taxes done in Feb, the accountant suggested getting a HELOC so we have accessible money for some home repairs/remodel desperately needed bathroom, etc. on current home, so when we downsize in 4-6 years (or possibly sooner, our home will be ready to sell without rushing to get Ďer done. DH plans to retire around in that same timeframe putting him at 64ish. We were approved for $250K no fees HELOC, but upon going in to sign the loan papers, we found that the bank rep put DH as sole responsible signer. FYI: The larger HELOC is just in case we find a home to buy before ours sells so we have cash to put down. Luckily, we now live in an extremely desirable neighborhood where the homes have always sold in 2-3 weeks.

We generally do most things jointly. Not sure why the rep made DH sole signer other than when I filled out the paperwork, I did not include my income since itís not much and goes back into my small biz (self-employed). DH brings home the dough and I handle all finances/bills (though heís in tune with things). Upon finding out about the sole signer, we postponed closing to decide whether to keep the HELOC docs as is or have me as listed as joint owner. Both of our credit scores are over 800, btw, and we are extremely responsible to use the loan only for its intended purpose (I've heard stories of others...). My question is: Does it really matter if DH is the only signer, or is it best to have both of us on the note as owners? We were dealing with a different banker yesterday as oppose to the one who originated the loan PW, so Iíll find out next week why she did it this way. Thoughts. Thanks.
Deej is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-30-2017, 07:11 AM   #2
Thinks s/he gets paid by the post
Join Date: Jun 2016
Posts: 3,584
I am not an attorney or tax pro but I wonder if your name isn't on the HELOC & DH had an untimely passing, what would happen?
Scuba is offline   Reply With Quote
Old 04-30-2017, 10:06 AM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
Originally Posted by Scuba View Post
I am not an attorney or tax pro but I wonder if your name isn't on the HELOC & DH had an untimely passing, what would happen?
The bank would be well within its rights to not honor any and all draws. Both people should be on this line.
"All animals are equal, but some animals are more equal than others."

- George Orwell

Ezekiel 23:20
brewer12345 is offline   Reply With Quote
Old 04-30-2017, 10:11 AM   #4
Thinks s/he gets paid by the post
2017ish's Avatar
Join Date: Apr 2012
Location: Nashville
Posts: 2,136
Strange. "Sole signer" on all documents? If you jointly own the house, the bank should be insisting on having you sign the encumbrance on the Deed, even if your income wasn't used on the loan calculations. (Last year, we refinanced our main mortgage and the loan was figured just on my income since DW's, even though higher, wasn't needed; she still had to sign the deed of trust; otherwise, the lender wouldn't have been able to grab the property if we didn't pay.)

Bottom line, if it is set up this way, it could be a problem for the lender; it shouldn't be a problem for you unless something quirky lurks in the law of your state.

In the situation postulated by Scuba, the term of art for what would happen to the bank is that it likely would be "S*** out of luck." (IF line had been drawn on)

(And, like Scuba, I don't have particular expertise in this area, as my practice is not in this area; so take fwiw....)

Edited after seeing Brewer's post
OMY * 3 2ish Done 7.28.17
2017ish is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Disadvantages of 401k rollover Packman FIRE and Money 29 04-16-2011 07:03 PM
Credit Unions: Any disadvantages? Orchidflower FIRE and Money 44 08-10-2010 05:32 PM
disadvantages of using broker acct for funds bobbee25 FIRE and Money 13 09-27-2009 11:39 AM
Advantages/Disadvantages HELOC or Second Mortgage wrigley FIRE and Money 18 04-21-2009 07:14 PM
Advantages/Disadvantages of rental property? military spouse FIRE and Money 52 01-26-2006 07:17 PM

» Quick Links

All times are GMT -6. The time now is 05:55 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2021, vBulletin Solutions, Inc.