Home Equity Line of Credit
Frequently Asked Questions
What’s the big difference between the first two products shown in your rate page?
With the first product you get Prime* – ½% for the life of the loan but it requires an initial advance of $10,000.00 and an automatic withdrawal from a N.M.S.B. checking or statement savings account. The second product is our standard Prime* + 0% for the life of the loan.
Do I have to pay an application fee?
There is absolutely no application fee, but fees may apply in certain circumstances and are detailed below.
What about an appraisal fee?
If there is not enough equity in your home by using a Broker Price Opinion (BPO), then an appraisal may be needed. For all loans over $100,000, an appraisal is required regardless of equity. The cost for a single family appraisal is $400. A two-family appraisal costs $550.
Can I borrow the full value of my home?
You can borrow up to 80% of the appraised value, or 70% of the Broker Price Opinion (BPO), subject to the bank reviewing the value through our own third party appraiser or agent. This figure is of course; reduced by any first mortgage balance.
What’s the difference between the appraised value and BPO value of the house?
The “appraised value” is the value of your home as determined by an appraiser. The “BPO value” is the value of your home as determined by an independent real estate broker.
What if I don’t have a first mortgage?
If there is no first mortgage in place, the equity line is considered a first mortgage. Closing costs will apply and will range anywhere from $1,625 to $2,200.
Are there any “hidden” costs I should be aware of?
There are NO closing costs unless this will be a first lien HELOC, you need an appraisal or have another title issue which needs to be resolved. However you should be aware that every line comes with an annual fee of $30.
I own my house in the name of a Trust. What other fees could I incur?
There will be a cost to review the Trust and record a Trustee Certificate, and any other documentation deemed necessary by the closing attorney, at the Registry of Deeds. This could increase your cost by as much as $400.
Are there any restrictions on how I use my money?
Absolutely not! There are no restrictions on how your Easy Does It Equity Line can be used!
Will I have to drive far or take a day off work for the closing?
Not unless you want to! Most closing will take place in your local NMSB branch. For those transactions which require an attorney, our local attorney will be happy to make your closing appointment convenient by conducting evening sessions. Just let us know!
What do I need to bring to the closing?
An NMSB representative will let you know if there are any items required at closing. Usually all you need to bring is the insurance binder and a valid state issued I.D.
Can I make more than the minimum payment without incurring a penalty?
Of course! Extra principal payments can be made at any time, without penalty. However, if the Line of Credit is paid off and discharged within the first 3 years a $400.00 termination fee will be charged. This fee does not apply to 1st mortgage liens.
Will I ever have the option of converting my home equity line balance to a fixed rate home equity loan?
Sure! You can apply to convert your equity line to a fixed loan at any time. Depending upon the fixed loan terms, closing costs may be incurred.
Are there any tax advantages to having an equity line of credit?
Yes, indeed! Interest paid on your Easy Does It Equity Line may be tax deductible. Check with your accountant or financial advisor.
*Prime Rate as published in the Wall Street Journal on the 1st business day of each month. Prime rate as of 03/16/2017 is 4.00%. Rate may change monthly. Maximum APR is 18%.