Are you looking for 100% LTV HELOC funding? If your loan to value is that high then banks are not very likely to be interested in approving a home equity line of credit unless of course your property has greatly appreciated. Even 80%, 90%, 95% LTV ratios are problematic these days. 

There are different ways you can approach getting a HELOC if you are mortgaged completely to the hilt. In the end for this to happen you have to have some home equity, or the bank has to have absolute faith in the market in that your property value will rise since you got in to the house.

I would suggest that it makes a difference on how long you have been in the house (or owned the property if you are just leveraging or flipping). The mortgage companies I’ve dealt with or worked for need to see some kind of positive track record in this brave new economy.

1. Improve your property by adding on or fixing it up on the cheap. You can do this by doing some painting, decorating and in some cases doing simple things like fumigating and cleaning up clutter. Do all of these things before your prospective lender sends over their appraiser.
2. Simply hope (don’t suggest that) that your home has appreciated enough in your local market that you now have some equity in the property. I suggest getting a good appraiser to come over and evaluate your property. Why? Because the bank will want to use their own appraisers to minimize any risk they may have in approving your HELOC.
3. If you have other collateral such as a new vehicle or some kind of secured asset. (however, then it’s not really a true HELOC is it)

When your LTV ratio is at 100% the bank may consider giving you a HELOC if you bought in a really solid neighborhood surrounded by a fairly sound local economy. The banks and mortgage companies are a little skittish these days as the 2009 economic horizon looks somewhat bleak.

As mentioned above, if you are in this strong position whereby your mortgage company is 100% confident that your property will increase considerably in value, then they may play the role of speculator and confidently provide you the home equity line of credit.

If for some reason the real estate market is weak or the bank’s appraiser does not see the same value in your home, they will fall flat on your application and no amount of jumping up and down will change their mind.

If you have an extremely HIGH FICO and the credit bureaus give you glowing reports you might qualify for a HELOC if you have an extremely secure form of employment and a high monthly income via wages. Furthermore, if you provide a guarantee that the money on your LOC (line of credit) is going to be used for renovations and home improvement, you are improving your chances of approval.

All you have to remember is that the mortgage companies, banks (non-conventional lenders and conventional lenders) only want to make sure they have themselves covered in case you run up against a rough patch and can’t afford to make the payments on your mortgage or your HELOC. If

your LTV (loan to value) ratio is 100% you are in for an up hill battle.

Don’t be that discouraged though – if you use some of the ideas in this installment you may be able to pull it off.