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Can I pay off a mortgage with a Home Equity Line of Credit in order to remove the lien on the propert?

? by Jessical87@gmail.com from Hollywood, California. Jul 12th 2010 Reply


Gregorio Denny (GVDenny)
#258 ranked lender in California - 380 contributions

Why do I feel like this is deja vu? If you payoff your first with a HELOC, you will still have a lien on the property.

Jul 12th 2010
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Richard Shapiro (RShapiro)
#12 ranked lender in Massachusetts - 71 contributions

If your Home Equity Line of Credit is enough to cover the mortgage, yes you can. When you pay off the mortgage, you will need to follow up with the mortgage company for them to issue a discharge which then removes the lien the first mortgage created. Now the $64k question: why would you want to pay off the first mortgage with a Home Equity Line of Credit?

Jul 12th 2010
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Brett Pehrson (brettpehrson)
#19 ranked lender in Utah - 228 contributions

The real question is what are you trying to accomplish by doing that? Is your rate on the HELOC much better than the rate on your mortgage? Will that help your financial plan? HELOC's are variable rate loans typically based on the Prime Rate; even though that rate is low now, it will start increasing in the near future. If you do pay off that first mortgage, make sure the lender releases the lien off title.

Jul 12th 2010
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Matt Davis (Matt Davis)
#152 ranked lender in California - 52 contributions

Hi Jessica,You can, yes, but you need to ask yourself what advantage that may be. There will be pluses and minuses depending on what you are trying to accomplish. When you pay off a lien, you want to make sure that the lender files the reconveyance to remove the first lien and show it as paid. Then, your formally second position lien will go to the first position on the title.Best,Matt Davis

Jul 13th 2010
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