05 · HELOC vs refinance

HELOC vs refinance

First $318K @ 3.125% · need $80K

Property & first mortgage

Property value

First mortgage balance

First mortgage rate

Remaining term

HELOC

Initial draw

Line limit

Intro APR

Intro period

Index (prime)

Margin

Draw period

Repay period

Minimum payment

Cash-out refinance alternative

Refi rate

Refi term

Closing costs

Blended rate · HELOC path

4.73%

Weighted average of first lien + HELOC balances over 10 yr · vs 6.125% refi

Lien stack · $520K property

CLTV 76.5%

$318K

$80K

$122K

First lien61%

HELOC15%

Equity23%

Combined payment now

$2,036.88

First + HELOC

Refi payment

$2,477.84

30 yr · 6.125%

10-yr total · HELOC

$257K

10-yr total · refi

$307K

Monthly payment · 10-yr stress paths

First-lien P&I plus HELOC minimum payment. Refi is flat at today’s quote.

−100 bps relief

4.45%

blended @ 10 yr

shock $140

Flat

4.73%

blended @ 10 yr

shock $124

+100 bps

5.00%

blended @ 10 yr

shock $109

+200 bps

5.27%

blended @ 10 yr

shock $96

+300 bps shock

5.55%

blended @ 10 yr

shock $84

Keep first + HELOC

First-lien rate3.125%

HELOC intro APR6.990%

HELOC fully-indexed8.750%

HELOC draw$80,000

10-yr total cost$257K

Cash-out refinance

New principal$407,800

Rate6.125%

Term30 yr

Closing costs$9,800

10-yr interest$232K

10-yr total cost$307K

HELOCs have variable rates and payment-shock risk at the end of the draw period. Blended-rate illustrations assume the current prime index persists at the fully-indexed rate unless stressed. Not an offer of credit.