Hi,

Is there a payoff early penalty for the home equity line of credit at Pentagon Federal credit uinion?

Can you apply now and use the entire loan amount at Fed/2004?
Thanks.

Actually SIS, according to Earnst and Young, IRS has ruled the interest on your primary residence ONLY must be treated ONLY as a potentially itemizable mortgage deduction, strange as this might sound. If someone doesn't beat me to it I'll try to dig up the reference later.

Okay I want to understand this before applying at Penfed.

We rarely itemize deductions and are considering taking out the HELOC on either our residence or on a condo we are selling to our daughter on a contract for deed. So if we want to offset the interest she pays us with the interest we pay on a HELOC draw, the HELOC must be taken out on the condo rather than our primary residence.

At least Penfed does HELOC on non owner occupied properties and a great introductory rate. After questioning them last night there seems to be no hidden fees besides joining that military organization which is a one time $20 fee for a continuing membership in the Penfed Credit Union.

She said it takes about a month to get the HELOC set up.

digimon said:

<< Does anyone know if I have to pay the mortgage recording tax in NYC for taking out a HELOC? >>

from what others in NY have posted, yes you do

The mortgage recording tax kind of kills the idea of having a line of credit.
I don't need the money yet but I still have to pay up front. That sucks. I wonder what is the percentage.

digimon said:

<< The mortgage recording tax kind of kills the idea of having a line of credit.
I don't need the money yet but I still have to pay up front. That sucks. I wonder what is the percentage. >>

suffolk county has a 1% recordation tax.

NYC I believe has a 1.75% recordation tax!!

Not positive on this but I've heard if you obtain the HELOC from your current mortgager you may not have to pay the recordation tax. Some of my co-workers are trying to refinance their homes and the closing costs they were quoted varied greatly as it appeared some banks were adding the recordation tax while others (namely the current mortgager) weren't adding the fee in.

klipdrift,

I thought PenFed has no fees. Why do you have to pay the $273 and may be the appraisal>

Sueyko,

Thanks for the info. I can see a tax being applied to mortgages. But for a HELOC, that is so unfair. For a hypothetical $100K, the tax would be $1750 and yet I may only draw much less than that from time to time. I don't mean to question your knowledge, but do you know anyone actually paid this tax for a HELOC (not a refinancing mortgage) in Suffolk or NYC?

Sueyko,

Where did you get your HELOC? I am thinking Citizens Advantage.

Sueyko,

DeepGreen could be the bank Citizens Advantage uses as a provider. How did they take out the mortgage recording tax? You mailed a check or they took it out from your credit line (so you would pay interest immediately)?