Study Finds Many Homeowners Clueless on HELOC Resets – NMP Skip to main content

Study Finds Many Homeowners Clueless on HELOC Resets

Phil Hall
Oct 18, 2016
Nearly half of U.S. homeowners will be facing resets to their home equity lines of credit (HELOC) during the next three years

Nearly half of U.S. homeowners will be facing resets to their home equity lines of credit (HELOC) during the next three years, according to a new study from TD Bank. However, many homeowners remain unprepared for the potential disruption this may present.

TD Bank’s study, which polled 812 homeowners, found that only 19 percent of respondents understood they would be making increased monthly payments with a HELOC reset, while 34 percent believed their monthly payment would be lower. Sixty percent that admitted not having a plan for dealing with their reset said they would not seek guidance on the matter from their lenders. More than one-quarter of respondents planned to refinance their HELOC by taking out another loan.

"Many HELOCs allow borrowers to draw for 10 years and make interest- only payments," said Mike Kinane, senior vice president for home equity at TD Bank. "When this draw period ends, borrowers are required to pay principal and interest, which may increase their monthly payments. It's important that HELOC borrowers plan ahead and review their contract to determine the best course of action based on their current and future financial situations." 

Published
Oct 18, 2016
Open Mortgage Names New President

Joe Stephenson, formerly of American Advisors Group, to lead daily operations.

Industry News
Dec 01, 2021
Homepoint Expands Refinance Program Offerings

Now offers Freddie Mac’s new refinance option, Refi Possible, making it easier for many homeowners with a Freddie Mac-owned mortgage to reduce their interest rate.

Industry News
Nov 30, 2021
Non-QM Lender Deephaven Hires Business Development VP

Dallas-based Tim Fisher charged with growing Deephaven’s correspondent business In Texas and surrounding states

Industry News
Nov 30, 2021
Biden Reappoints Powell As Federal Reserve Chairman

A signal that The Fed will continue its policies as inflation surges and economic uncertainty spikes due to an emerging variant of the coronavirus. 

Industry News
Nov 29, 2021
Servion Taps Sagent For Consumer-First Servicing Tech Stack

A 7-year deal between Servion Mortgage and Sagent will equip Servion with Sagent's tech stack for performing, non-performing, and consumer experience.

Tech
Nov 29, 2021
Guaranteed Rate's Banosian Funds $2B In Total Loan Volume

The mortgage industry shouldn't be surprised by Guaranteed Rate's top loan officer, Shant Banosian, funding $2 billion in total loan volume during a record-breaking year. After all, “The Billion Dollar Man” is one of the top 5 loan originators in the U.S.

Wholesale
Nov 29, 2021