Home Equity Line/Loan

I paid cash for a 4-unit in SW Ohio. To be more specific, I used a combination of cash and a credit line, but I do not have a mortgage on it. I wanted to get a Home Equity Line/Loan to free up the cash and credit line.

I approached US Bank were I already have an account and was turned down because it was NOO. Is this a common problem with NOOs? Are there any suggestions as to where I can turn to get a HELOC or loan against a property of this type? Or is there another way that I can free up this money?


You could do a straight cash-out on the property. It would pay off the HELOC and put some cash in your pocket. Since it is a 4-plex you will be capped at 70%. Hope this helps.

I don’t have a HELOC, but i do have an unsecured LOC that i used in combination with cash to buy the building. I applied for a HELOC and a Home Equity loan. They were both denied due to the NOO status.

What is a “straight cash-out?”


That is just my slang term for a first lien conventional cash-out. I apologize for the confusion. How long have you owned the property?

I purchased it in April '08. I thought that a Home Equity loan was a 1st lien since the property was the collateral and there is no mortgage. Is this right? Or is there some other loan vehicle I should be looking for?

This is not an unusual situation at all. This is just a typical NOO cash-out loan. The HELOC is a bit more difficult because typically the bank that issues the HELOC holds it in their portfolio and can be very selective. A conventional NOO cash-out is typically sold on the secondary market to FANNIE/FREDDIE and servicing rights can be transferred. Perhaps what is happening is that USBANK may have more stringent guidelines in regards to NOO properties. Being an Ohio native I do quite a bit of business there and I have not run into any weird NOO laws. However there is no stated income in the state of Ohio so you definitely have to be able to prove income. Hope this helps.

p.s. Go Bucks!!!

Thanks for the info. It’s my first time making a purchase with anything other than a conventional mortgage. So, to clarify, the product I need to ask for is a “NOO Cash-Out Loan”

Is this almost like a refi except after it’s paid off?

Are smaller local banks better than National banks for this type of loan. Or is it so common that is really doesn’t matter?

The income verification is no big deal since REI is secondary to my day job.

Wells Fargo made me wait 6 months after purchasing to take out a HELOC.

You should be able to use a mortgage broker, either local or nationwide that understands investment property financing. A cash out with little seasoning is not that big of a deal if who you contact knows which lenders to use.

I am personally in the same boat. I have owned the property for 2 yrs next month. It is worth 255K single family dwelling. I used my home equityline from my personal home to pay this house off back in May 2008 I owed 93K on the home.

The reason I paid it off was the interest rate was 6.875% my plan was to just get a home equityline on the property for 100K at BofA since I have banked with them since 1981 and I was going to pay the 100K back on my home the interst rate would have been 4.75% thats good that was the whole reason I was doing this.

BofA made me wait 5 weeks to tell my they wont do the loan. After 2 yrs tax returns and our credit score at 787 so I am not to happy.

I don’t want to do a regular 1st or I would have keep my original loan.

I guess the debt ratio is to high. I told them in 5 phone calls over the last 5 weeks the reason for this loan was to pay the money back on my home so now Friday they said they would take it back to the under writer and explain this but they said if they where to do this they would pay the money back on my home then lower my home equityline would I agree to that.

I plan to quit BofA after this they have lost my business.
I would like to know how you solve this problem yourself.
Thanks in advance… Mo

I’d still suggest contact 30-40 local banks in your area to ask them if they can do a commrcial line of credit tied to that investment property.

What area are you in?