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HELOC needed, exceeding the 43% limit on debt to income ratio

Hi,

My debt to income ratio is 36% currently and I am looking for a HELOC of $100k but the debt to income ratio goes above 43%. My LTV after the 100k HELOC will be 80% and my credit score is 800. Is there a way to qualify for a HELOC (or another kind of loan) where my LTV stays below 80% but debt to income ratio is higher than 43%?
  • June 12 - Boston
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Answers (5)

Perhaps consider a cash out refinance to 80%LTV.  Look at your rate on your current loan and compare it to the rate on a cash-out refinance.  It could make sense, also considering that HELOCs are variable, and you can still lock in a decent fixed rate.
I do not do loans in your area, but there may be banks that do what we can do with regard to Debt-to-Income (DTI).  We have an ability to go to much higher DTI considering residual income or reserves.  We often go to DTIs on Jumbo loans in the 50s to 60, and sometimes higher.  And this is with same LTV, no add-on to rate or points,including ARMs, Fixed, IOs.  It can benefit you to shop Portfolio lenders.
  • June 18
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If your dealing with a Bank vs. a mortgage broker, you might be stuck with their limited selection of loan products with very restrictive guidelines.. brokers have access to numerous lenders, all offering a variety of lending programs...  and the broker is experienced in seeking out the best loan terms for your exact scenario.   There are options to help.. 45% to 47% LTV, ARM rates, Asset Depletion added as income, cash out first mortgage, etc, etc, etc.. get with a mortgage pro, not a bank teller, and you should find a way to make it happen.  

Feel free to reach out to me via my profile if you have any additional questions or concerns. William J. Acres, Arizona's Mortgage Expert.

  • June 12
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Yes you can refinance and cash out to 80% LTV or seek out a local bank where you do your banking and ask for a separate HELOC. I would be happy to assist you.
  • June 12
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We can go as high as 45%.  We use 7% IO as the qualifying rate. 

Hope this helps.

Best of Luck!

Eric
  • June 12
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Hi there, is it an option for you to do a cash out refinance and receive a lump sum instead?
  • June 12
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