Using HELOC to protect house against personal guarantee in California

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by a searcher from Humboldt State University
in Vacaville, CA, USA

2yrs ago

Using HELOC to protect house against personal guarantee in California

Curious if anyone has done this before. At this weekends self funded search conference in Dallas various searchers mentioned the ability to protect our house from a personal guarantee required for an SBA Loan by taking out a HELOC on our house. What are your thoughts or experience?

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reply by a searcher 2yrs ago
in Tampa, FL, USA

It depends on the state and you should consult an expert lawyer in your state about Homestead exemption law in your state.

I'm in Florida and I talked with a lawyer in the state who specializes in the law and even though it was if memory serves $400 for an hour consultation. It was more than worth it to be 100% sure what the law was for my particular situation.

Even if the banker says you should be okay... You should still consult a lawyer in your state because after talking with the lawyer - the bankers while technically correct in my situation - it could have led to some major issues down the line the way they wanted to structure things and how the homestead laws work in Florida.

reply by a lender 1yr ago
from University of Southern California in Los Angeles, CA, USA

The bank should not take a second on your home if you have less than 25% in equity. It’s purely negotiation. We have many lenders in our network that don’t require lien on the primary home even if you are in California. If you’re interested in learning more, feel free to reach out for an introductory call here: redacted