Possible to unfreeze line of credit?

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  #1  
Old 01-25-19, 01:46 PM
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Possible to unfreeze line of credit?

Wondering if anyone has had any luck unfreezing an equity line of credit after it was frozen due to a significant loss in equity. I opened up a 60k line back in 2005 and it was frozen after the housing market crashed. The equity has now recovered (~58% LTV) and I'd like to free up the credit for home improvements on my primary residence. I will of course be contacting the bank to inquire, but was curious if anyone has been in the same situation and what all you had to do to unfreeze the available credit. I'm guessing refinancing may be the only option.
 
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Old 01-26-19, 12:42 PM
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First, call the lender and ask about reactivating, and for copies of the LOC documents.
See what they say, see what the version they send you says about restarting, AND check the local recorder of deeds to see what the recorded version says about restarting.

What did they use to calculate the DROP in equity? I can't imagine they'd spend money for an appraisal, so it may be a simple "realtor opinion of value" which is easy to obtain.
 
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Old 02-04-19, 08:02 AM
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I'll call them this afternoon and inquire about these things.

I'm not sure what they used to calculate the drop. The housing market crashed and they automatically froze the account. I may be able to dig up the notice, but it's been 10 years so I'm not positive I'll be able to find it.

Seems to me the chances would be slim that they would simply restart the HELOC considering 10 years has passed and my financial situation is vastly different. I'm thinking they'd want me to go through the entire application process again, which I'm not going to do. Although unfreezing an account and making more credit available doesn't increase my DTI, so maybe it is an option. I really don't know.

I failed to mention that I have been making fixed payments towards the existing balance for the past 7 or 8 years, so that could compound things. I'm guessing there is no easy way to restart it.
 
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