Fishy banking situation
Question: My parents are trying to get a line of credit on a home worth $150k. The bank’s offer: $33k line of credit if the house is used as collateral, plus my parents must allow the bank to pay off their car loans and then pay back the new bank at 6.4% interest, plus accept a $10k “no strings attached” cash loan that can be paid back in full the very next day. Plus, the bank won’t fax the agreement, they’re forcing my parents to drive 6 hours one way to sign papers in person. Is this a crappy deal or what?
Answer: No bank will allow a legal agreement to be signed by fax. As a matter of fact, mortgage papers (which is what a home equity loan is) is almost always notarized during a formal closing process at the bank.
As far as the terms of the loan are concerned, your parents might want to shop around more for a better deal, now that the Fed cut rates again today.
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Filed under: Home Equity Loan
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