Tag: line of credit

Calculating a monthly payment on a variable HELOC monthly payment amount.

Question: My client has a HELOC line of credit which requires interest only payments each month.  As the line of credit loan balance shrinks, so does the required monthly payment.  How do I calculate this payment for consideration in the DTI? Answer: It is a vague guideline in the selling guide for Fannie Mae, and […]

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Calculating a payment on a HELOC loan – Draw Amt. vs. Line Amount

Question: My client has a HELOC which will remain open at closing. When calculating the payment on this line of credit for DTI purposes, should the payment be based on the full line amount or just the draw amount? Answer: Freddie Mac guidelines do not specifically address this situation, so we reached out to Freddie […]

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