Question:

What is a no fee home equity line of credit (HELOC)?

Answer:

Well, some HELOCs will allow you to save on application and origination fees, others will save you home appraisal cost, credit report cost, mortgage tax, attorney, etc. However, many lenders will simply roll those fees into the loan, or will charge a loan servicing fee on a monthly basis to make up for the no fees HELOC option.

A real no fee home equity line of credit (HELOC) shouldn't have minimal draw amount restriction, no usage fee, no home appraisal should be included, no maintenance fee, no prepayment penalty, no HELOC application fee, and no closing costs.

Different HELOCs will offer different combinations of excluded fees. If a lender seems to be charging you more than 2 or 3 of the abovementioned HELOC related fees, you should seriously consider going to another lender.

You should really make use of a no cost or a no fee home equity line of credit (HELOC), rather than paying all those HELOC fees. Just don't forget to consider the interest rate, as well.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
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Why: Know and protect your credit report and score.
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Common misspellings: mortage and morgage