No. of Recommendations: 3
My wife and I are attempting to refinance our Home Equity Line of Credit. Since we have held our current HELOC for just over one year, according to our lender "if during the first 36 months of your loan you prepay your entire outstanding balance which results in a release of your mortgage or security interest in your co-op, you will pay an Early Closure Releae Fee equal to third party processing fees and any costs we incurred to open your account".

Our mortgage broker has told me that this is a common practice in the industry with regards to a HELOC. Has anyone else dealt with this issue? Thanks.

It is a fairly common clause on many mortgages, not just HELOCs. Some of them require you to pay 6 months or 1 years interest. Others, especially the no-cost refi's and HELOCs have clauses similar to yours that require payment of the costs if you don't hold the loan long enough for the bank to make up the costs.

However, it should have been clearly disclosed to you at the closing. Do you still have the closing papers that you can go back and look?

Print the post  


UGC Disclosure Notice Regarding Credit Card Posts
Community board discussions about credit cards are not provided or commissioned by banks who may have advertising relationships with The Motley Fool. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.