HELOC or year fixed mortgage?
I have a HELOC on my home with a balance of $110k. It is set to the prime rate and it will adjust as soon as the rate moves. Right now it is 3.5% as it increased by .25 earlier this year. I still have 18 years left in the HELOC. The property’s value is around $800k and my credit scores are in the high 800s. Is it a good idea to switch the HELOC to a 1 year fixed mortgage that I can pay off in 12 years or do I stick with the HELOC? by tbusch841 from Encino, California. May 12th 2022
Joe Metzler (JoeMetzler)
#17 ranked lender in Minnesota - 4,848 contributions
Maybe... But it for sure would have been better last year when fixed rates were in the upper 2's and low 3's. Now with fixed rates well into the 5's, you would immediately experience the higher rate, but you lock in no further adjustments. You can also refinance it again in the future if rates drop. On the other hand, your rate at the moment is still good... It is just their is a lot of uncertainty and potential risk going forward with any adjustable loan. I lend for NON-QM in MN, Wi, IA, SD, ND. Find me at JoeMetzler.com - Cambria Mortgage, NMLS 274132
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