National City cancelled my home equity line

Be on the look out for a letter in your mailbox alerting you to the fact that your home equity line has been reduced or canceled. This is my second one that I have received in the last 30 days. The line on my rental property from Washington Mutual was reduced $20,000 and now my line on my home of $60,000 was completely taken away by National City. They may not honor any checks that were written so you need check on that. To answer the question, a bank can do this on a second mortgage? It is definitely in the provisions of their notes to reduce or suspend any credit line.

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How to Lower your second mortgage at National City

I just spoke with a client of mine who I did a second mortgage for at National City Home Equity. He told me that he paid them $50 to recast his mortgage again after he had already set it. National City heloc second mortgages came with a feature that allowed you to lock it in. He had a home equity line of credit which is typically variable, however they allow you to fix it in on an interest only payment for 7 years. He had locked it in a few years ago and had made it a fixed. He just called them and they are allowing him to drop it again. I had never heard of that. He was able to drop his rate over 3%.

If you have a National City loan and have already fixed it in, you may want to call them again to see about a recasting fee and get a lower rate.

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What's the deal, Wamu cut my credit line

The home equity fairies were at it again. Sadly they cut into my own heloc. I had a home equity line of credit with an original line of $27,500. Wamu just sent me a letter stating they are cutting my line to $8300. Second mortgage companies are positioning themselves against potential future loses. If you have a credit line now, don't count on it being there in the future. There are no guarantees that you will have it in the future. They can do this, it is written into their mortgage notes.

Don't be surprised if you find a letter in your mailbox stating that your line has been cut down. I have a rental property with a line from National City on it. I guess I will be getting a letter from them soon as well.

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