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We were just informed that Wells Fargo will only give up to 85% (it may even turn into 80%) for their HELOC's. I am so sick of being punished because someone else messed up and now everyone has to pay for it.
85% of the home amount. I guess I am just mad because the people who messed it up for everyone are all getting these sweet deals on their new mortgages and someone who has stellar credit and has been responsible their who lives, has to jump through hoops just to get a simple HELOC.
Well, Wells Fargo has been praised for being one of the few lenders who seems to have weathered the storm well. It's probable that they did some internal audits of their HELOC customers and found the initial signs of a possible trend...and are trying to head it off at the pass before it gets out of hand.
Most lenders have done the same, 85% LTV is the max I have seen for HELOCs lately. Same with many "cash-out refinances", Fannie and Freddie are capping the max LTV on these as well.
80% LTV is more the norm in historic terms, the banks are just going back to the standards they know were stable. I guess you'll need to find another way to buy your pony.
Considering housing trends the lower LTVs are a hedge against falling real estate values. Makes sense to me.
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