EquityLineBlog

Zillow made waves when they made it easy to get a rough idea of your home value with Zestimate. You can even get a home estimate via cell phone text. It doesn’t replace a professional home appraisal, but it can give you a ball-park starting point to get an idea of what size of loan you might need or qualify for.

A few days ago, they made even bigger waves in the mortgage industry with the announcement of Zillow Mortgage Marketplace. Here’s how it works:

1. Create a Loan Request
   You are anonymous to lenders — no name, phone, or SSN required
2. Receive Quotes
   Get personalized quotes from confirmed lenders
3. Contact the Lender
   Review quotes, profiles, and ratings. Then you contact them, they don’t call you.

It’s free for both borrowers and lenders, and it could be a terrific way to shop for your home equity line. Yep! HELOCs are supported in the mortgage request form.

What’s especially interesting about the Mortgage Marketplace is that they are attracting lenders with free unlimited home loan leads — and it’s working. As of this posting, there have been 6345 loan quotes in response to 5711 loan requests. Not bad for a four-day-old service!

I filled out a loan request form to test it out. The process was painless. I’ll let you know how it works out!

I recently decided to make large payments to my HELOC and then swipe the equity line credit card for purchases in order to reduce the average daily balance on the HELOC for interest calculations (in other words, save money). Before I made that change, I got advice from my dad (a mortgage broker) about whether or not it was a good idea.

He told me at the time, not only is it a good idea, it’s a common practice in Australia, and has recently caught on in America. Recently, banks have become much more conservative about equity loans, and they’re under increasing pressure to be more conservative about the credit they’re providing to customers. With that in mind, there has been a recent freeze in home equity lines. My dad called me to warn me about it so that I wouldn’t have money frozen in my equity line that I would need to pay my other bills.

I decided to investigate. As far as I can tell, equity lines are being frozen when property values dip lower than they were when the equity line was first approved. Since my property has appreciated since my HELOC, and the value is holding well, this probably won’t effect me, but it’s a good idea to be aware of this practice — especially if you’re using your HELOC to make regular purchases, like I am. I found a Youtube video on the subject: