Comments on: 100% equity in home… need loan advice?

By: Chillin K

Chillin K — Thu, 17 Sep 2009 14:26:50 +0000

Unless you absolutely have to have cash, getting a loan is not a great idea.

You’re doing all the right things, but you may want to consider incorporating a business and transferring your assets to the corporation. This will protect you personally and give you some options that you don’t have right now. You can draw a salary from the corporation, which will give you income that you can show. Also, you will pay for everything with pre-tax money, and make your own decisions about how much you want to show as profit (and pay taxes on that money ) and how much to pump back into the business. As an owner of a corporation, you are not self-employed. You are hired by the company as an employee. You will have 2 separate entities, yourself and the corporation, with 2 separate credit scores.

By: Bettie M

Bettie M — Thu, 17 Sep 2009 14:26:50 +0000

I just negotiated a refinance on my home today with my current mortgage lender. They asked for proof of income – w2’s for the last two years, plus pay stubs for the past two months. They also wanted proof of liquid assets. I am an existing customer with excellent credit. I assume that your lender would want at least that much. In addition lenders will check your credit. A good credit rating means better interest rates and terms for your loan. You should consider getting your income stream in place prior to borrowing money. You also need to look into establishing credit by opening a credit card account, etc. Having said that, why not just go on-line and fill out a home equity loan application with a mortgage lender. Someone will contact you and be able to give you the info you seek.

By: Jerrold J

Jerrold J — Thu, 17 Sep 2009 14:26:50 +0000

Cillin K has given you GREAT advice and the only thing I would add is WHY do you need the loan? You will ahve a hard time getting a loan based on lack of employment income, new business, etc and that means a higher closing cost for the loan and higher interest rates. You need to have a purpose for the loan that will generate a higher rate of return then those funds cost you so without knowing where you will spend the money; getting a loan is not a great idea.