Getting paid to close out a HELOC?

[Kronk]

We have a zero balance on our HELOC, with $250,000 available. Rate is at prime. Right now we don't have much in the way of after-tax accounts, so we were keeping this around as an emergency found.

I got a letter yesterday from my HELOC company, though, and if we close out our HELOC, they'll send us $400. We think we'll be taking them up on the offer. In the case of an emergency, we can always get another HELOC, albeit at (I'm sure) at a lower credit limit.

Anyone else hear of being paid to close a HELOC?

 

[brewer12345]

Never heard of it. Bizarre. Can you tell us who the lender is?

Might be worth talking to Pen Fed or someone similar to line up a new HELOC.

 

[ziggy29]

Just make sure it doesn't cost you $400 or more to set up the new HELOC.

Sounds like some banks are using carrots rather than sticks to clear some of these out...

 

[Nords]

Never heard of it. Bizarre. Can you tell us who the lender is?

... 'cuz we want to short that stock before their next SEC filing!

 

[brewer12345]

... 'cuz we want to short that stock before their next SEC filing!

Shhh...

Actually, I think its a better and more creative way of dealing with a line you are nervous about than just cutting the customer off (which tends to PO them). Of course, my immediate reaction would probably be to draw the entire line immediately...

 

[Helena]

This is interesting.

I also would like to know the lender's name.


~

 

[Kronk]

National City Mortgage.

 

[brewer12345]

National City Mortgage.

That explains a lot. Surprised they didn't just cut you off.

 

[Sue J]

We have a zero balance HELOC open at Huntington (what we refer to as The Stupid Bank, for a variety of reasons). We keep it "just in case" and haven't used it in years. I'd love it if they'd offer us money to close it. I'm only keeping it open because if I ask they waive the yearly fee.

 

[Achiever51]

National City Mortgage.

National City is doing all kinds of stuff to try to improve their financials. Lately they've offered 5% CDs, incentives to open new savings/checking accts, and other specials.

Here's a recent CNN story about them...

National City confirms regulatory agreement

from the CNN article:
National City, like many other banks, has struggled in recent months due to the sharp downturn in the housing market and rising defaults among many types of loans, especially mortgages and home equity products. National City lost $171 million during the first quarter, largely due to losses tied to the mortgage and real estate markets.
In April, National City raised about $7 billion in new capital to shore up its balance sheet.