Can I Combine My First Mortgage And Home Equity Line of Credit Into One Loan?

Q: I live in California and I have a first mortgage and a home equity line of credit with the same bank. My first mortgage has a rate of 5 percent fixed for 30 years and the home equity line of credit is prime plus 1 percent.

I have been paying my loans on time, without any late payments. I called my lender to ask whether I could combine the loans or refinance them into one loan and I was told that I could not. They offered me a first mortgage refinance at a rate of 4.65 percent plus 1 point for 30 years, with no PMI, and no income or asset verification. Then the lender said I could add up to $2,500 of the total closing costs to the loan.

Like most people, I am upside down on my mortgage and my current loan-to-value ratio on my property is 155 percent. I made a separate call to the bank to inquire about converting the HELOC to a fixed rate and was offered a 10-year rate at 8.25 percent, which I declined.

I am looking for advice on how to approach my lender and ask to have both loans converted into one loan at today’s current rates.

A: A lot of homeowners are also wondering how to take a first mortgage and a home equity loan or line of credit and combine them when they don’t have enough equity in the property. The short answer – there is no good answer.

But let’s look on the bright side: Your current 5 percent first mortgage is at a great interest rate. Your home equity line of credit (HELOC) at the prime rate plus one percent is also a great rate. At today’s prime rate of 3.25 percent, your interest rate on that loan is only 4.25 percent. You really can’t get much better than that today.

While you can refinance your first mortgage, you’ll pay a lot in costs. If your loan amount is $300,000, paying one point to get the lower interest rate will cost you $3,000 plus other closing costs. Those other closing costs might be around $2,000. So the total cost to get the lower rate would be about $5,000. Your monthly savings would be about $90 but it would take you about a little under five years to break even with the costs to get the loan. That doesn’t sound like a good deal to me.

Likewise, your HELOC has a pretty good interest rate right now, although it is a variable-rate mortgage. If interest rates go up in the future, you could get hurt by those increases. On the other hand, you could put the $5,000 that you otherwise would have spent refinancing your first loan to pay down the amount you owe on your HELOC.

If interest rates remain stable or rise just a bit over the next several years, you certainly will benefit from the terms of your current loans without having to pay money to refinance. By prepaying your HELOC, you can head off any extra financial stress caused by rising interest rates.

The bad news is that you will find it difficult to get a lender to refinance your mortgages at this point in time because you owe more than the home is worth. And even if you could refinance, you’d pay more each month than you’re paying now.

Read more:
Homeowners Struggling with a Second Mortgage Get Some Help.

Mortgage Loan Modifications: Do you have to be late to qualify?


Rate This Article
1 Star2 Stars3 Stars4 Stars5 Stars (3 votes, average: 15.00 out of 5)
Loading...Loading...
Related Topics
, , , .
View our other articles that are related to this post.

© Ilyce R. Glink. All rights reserved. This content may not be used, distributed, syndicated, compiled or excerpted in any medium or form without written authorization from Think Glink, Inc. For information on syndicating ThinkGlink.com please contact us.

38 Responses to Can I Combine My First Mortgage And Home Equity Line of Credit Into One Loan?

  1. Your webpage won’t render appropriately on my iphone4 – you may wanna try and fix that

  2. With havin so much content do you ever run into any problems of plagorism or copyright violation? My blog has a lot of completely unique content I’ve either created myself or outsourced but it appears a lot of it is popping it up all over the internet without my permission. Do you know any ways to help reduce content from being stolen? I’d really appreciate it.

  3. Hello! I just wanted to ask if you ever have any trouble with hackers? My last blog (wordpress) was hacked and I ended up losing a few months of hard work due to no data backup. Do you have any methods to stop hackers?

  4. This will be a fantastic site, would you be interested in doing an interview about how you developed it? If so e-mail me!

  5. I do like the manner in which you have presented this specific situation plus it does provide us a lot of fodder for thought. On the other hand, from everything that I have experienced, I just wish when the actual responses stack on that people today continue to be on issue and in no way embark upon a soap box involving the news du jour. Yet, thank you for this fantastic piece and whilst I do not really concur with this in totality, I regard your point of view.

  6. Mon introduction 脿 Cr茅er SpaceDuring les vacances de No毛l Kathy s’est pr茅sent茅 脿 un 茅v茅nement artistique o霉 je montrais quelques photographies et signer des livres. Elle m’a demand茅 si j’avais trouv茅 un 茅diteur pour Bear Song. Quand j’ai dit non, elle m’a parl茅 de son exp茅rience avec Cr茅er un espace. Elle a r茅pondu 脿 toutes nos questions, m锚me certains sur la fa莽on de formater dans Word. 脌 la fin de la r茅union, elle m’avait convaincu que je pouvais le faire. Le fait que je n’ai pas de co没ts initiaux a d’autant plus attrayant. Je rentrai chez moi, sign茅 pour un compte, et commenc茅 脿 lire leurs informations. J’ai aussi lu les messages du forum pour voir quels sont les probl猫mes des gens rencontraient et les solutions qu’ils avaient trouv茅.

  7. Simply wanna state that this is very beneficial , Thanks for taking your time to write this.

  8. Along with every little thing that seems to be building throughout this specific subject matter, your perspectives happen to be very stimulating. Even so, I appologize, because I can not subscribe to your entire strategy, all be it exciting none the less. It would seem to everyone that your opinions are not completely validated and in actuality you are yourself not really completely confident of your argument. In any case I did appreciate reading it.

  9. Everyone loves what you guys tend to be up too. This type of clever work and exposure! Keep up the terrific works guys I’ve included you guys to blogroll.

  10. I’m really enjoying the design and layout of your blog. It’s a very easy on the eyes which makes it much more enjoyable for me to come here and visit more often. Did you hire out a developer to create your theme? Great work!

  11. Chaque premier dimanche du mois, Alexandre Brun convie membres de sa famille, amis et relations dans le salon de l’appartement de la rue du Cotentin, o霉 les esprits s’茅chauffent vite 脿 d茅battre d’Hitler et de Mussolini, des cong茅s pay茅s et de La grande illusion. Certains invit茅s parmi les habitu茅s, on compte un colonel, une g茅n茅rale, une professeur de piano et un notaire n’h茅sitent pas 脿 se plaindre du nombre de “n猫gres” et de “m茅t猫ques” qui envahissent la France.

  12. Thanks designed for sharing such a good thought, piece of writing is good, thats why i have read it completely

  13. Hey there! This is my first visit to your blog! We are a collection of volunteers and starting a new project in a community in the same niche. Your blog provided us beneficial information to work on. You have done a wonderful job!

  14. Thank you, I have just been searching for information about this topic for a long time and yours is the best I have found out so far. However, what in regards to the bottom line? Are you positive in regards to the source?

  15. I’m not that much of a internet reader to be honest but your blogs really nice, keep it up! I’ll go ahead and bookmark your site to come back down the road. All the best

  16. Throughout this awesome design of things you secure an A just for effort. Where exactly you actually lost everybody ended up being on all the details. You know, as the maxim goes, details make or break the argument.. And it couldn’t be more accurate at this point. Having said that, let me reveal to you exactly what did give good results. Your writing is actually highly powerful which is probably the reason why I am taking an effort to opine. I do not make it a regular habit of doing that. Second, while I can easily notice the jumps in reasoning you come up with, I am not really convinced of just how you appear to connect your details that help to make your final result. For the moment I will subscribe to your point but hope in the foreseeable future you connect your dots better.

  17. Hey there just wanted to give you a quick heads up and let you know a few of the images aren’t loading correctly. I’m not sure why but I think its a linking issue. I’ve tried it in two different browsers and both show the same outcome.

  18. At this time it looks like BlogEngine is the best blogging platform out there right now. (from what I’ve read) Is that what you’re using on your blog?

  19. I believe one of your advertisements caused my web browser to resize, you might want to put that on your blacklist.

  20. A large percentage of of whatever you articulate happens to be supprisingly accurate and that makes me wonder the reason why I had not looked at this in this light previously. Your piece really did turn the light on for me as far as this particular subject matter goes. Nonetheless at this time there is 1 factor I am not too comfy with so whilst I try to reconcile that with the central idea of your position, allow me observe just what the rest of the visitors have to say.Very well done.

  21. It’s an remarkable paragraph in favor of all the online users; they will obtain advantage
    from it I am sure.

  22. Pingback: MK8348 MK Envelope Logo Brown Michael Kors Wallet

  23. Incredible! This blog looks just like my old one! It’s on a entirely different topic but it has pretty much the same page layout and design. Superb choice of colors!

  24. Howdy! I realize this is kind of off-topic but I had to ask. Does running a well-established blog like yours take a large amount of work? I am brand new to running a blog however I do write in my diary everyday. I’d like to start a blog so I can share my own experience and feelings online. Please let me know if you have any kind of recommendations or tips for new aspiring blog owners. Thankyou!

  25. Non mi piace dire addio. Non mi piace stare da solo. Non mi piace quando la canzone quando canto sbagliato. Non mi piace essere chiesto una spiegazione. Non mi piace la gente non lo fanno r ponde mie domande. Non mi piace dover fare delle scelte. Non mi piace quando qualcuno mi manca troppo. E altre cose. Due tre gocce di felicità semplice. Penso che sto annegando in un sordo, giornata grigia. Certo, rido, sorrido, non direi che tutto è falso, ma è re m ph. Quando il mio sorriso s ‘teind non lo è. Semplicemente. Non possiamo essere felici per tutto il tempo, ma qualcosa deve accadere che passa sopra gli ostacoli nostra felicità, siamo in grado di guarire e imparare a fare un passo indietro. Per vivere semplicemente. Come un bambino.

  26. I was wondering if you ever considered changing the structure of your site? Its very well written; I love what youve got to say. But maybe you could a little more in the way of content so people could connect with it better. Youve got an awful lot of text for only having one or two images. Maybe you could space it out better?

  27. Have you ever considered writing an e-book or guest authoring on other blogs? I have a blog centered on the same ideas you discuss and would really like to have you share some stories/information. I know my subscribers would value your work. If you are even remotely interested, feel free to send me an e-mail.

  28. Music started playing as soon as I opened this blog, so frustrating!

  29. Write more, thats all I have to say. Literally, it seems as though you relied on the video to make your point. You clearly know what youre talking about, why throw away your intelligence on just posting videos to your site when you could be giving us something informative to read?

  30. Interesting blog! Is your theme custom made or did you download it from somewhere? A design like yours with a few simple adjustements would really make my blog shine. Please let me know where you got your theme. Thanks

  31. What i don’t understood is if truth be told how you are no longer
    actually a lot more well-appreciated than you may be right
    now. You are very intelligent. You already know thus significantly when it comes
    to this matter, made me individually consider it from numerous numerous angles.

    Its like women and men aren’t involved except it’s one thing to do with Girl gaga!
    Your personal stuffs nice. All the time maintain it up!

  32. Hey I know this is off topic but I was wondering if you knew of any widgets I could add to my blog that automatically tweet my newest twitter updates. I’ve been looking for a plug-in like this for quite some time and was hoping maybe you would have some experience with something like this. Please let me know if you run into anything. I truly enjoy reading your blog and I look forward to your new updates.

  33. wow tips says:

    Put into use contests are actually a magnificent buy. Flash games are frequently too costly with high priced. And that is hard to look at produced by a sport and discover out you cannot stand it. Its certainly an undeniable fact that many sexually active grownup males act as if they are on medicinal prescription medications a lot fondness on top of that literally are demotivated,, Mentally great deal sure of however to get counselling pregnant young chicks simply just rotate wintry and even harted avoiding. I women of all ages became occupied with me and whenever I shared with her I thought simlar she or he for you to push away and detest me and humiliated to these freinds that converted into a prick. I absolutely quited ta to her abd my girl don’t stop as providing butt so my partner and i the only method to stop heris as a wang and thus contradict ourselves.
    [url=http://www.bearunner.org/news]wow tips[/url]

  34. Zentai costumes are skin tight garments that cover the body system. This is exactly why many hot figures are glad to wear Zentai costumes for dressup parties even in the daily life. Zentai costumes are very taken by any people, Female or male, A kid or old.
    [url=http://charterdayschool.net/wp-content/uploads/temp.php]buy zentai suit[/url]

  35. The lowest low was ‘stickergate’, at a Saturday National Hunt card last January, when racegoers who were deemed inappropriately attired (for a midwinter jumps card, for goodness’ sake) were made to wear orange stickers to denote that they had already been warned about dressing properly in the future.

  36. Submitted papers must present unpublished work, not being considered for publication in other journals or conferences.

  37. Howdy just wanted to give you a quick heads up. The words in your content seem to be running off the screen in Ie. I’m not sure if this is a formatting issue or something to do with internet browser compatibility but I figured I’d post to let you know. The design and style look great though! Hope you get the problem solved soon. Thanks

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>