HELOC's and default

[Steve Smegner]

I have a lead that is having some financial distress. He has a first, HELOC, VISA, checking and savings at Bank Of America. He is current on the First and HELOC but has defaulted on all his credit cards including the BOA Visa.

Question: If I were to pursue a subject 2 type of aquisition I am worried about the HELOC. Do lenders cross-collateralize or universal default HELOC's? I would hate to get into an aquisition only to find that the HELOC gets jacked to 29.99% or something like that.

Does anyone have experience with this?

[George Roddy, Jr.]

Steve,

On the HELOC, I would look at the deed of trust and promissory note to verify what kind of index the loan (rate) is based on. It may be a fixed.


George