After a Re-finance

From: Rick -


Hi

Thanks everyone for the informative posts.

I've only just discovered this forum and the amount of knowledge that is given freely on it.

There is no such thing as a dumb question so here goes.

After a recent re-financing I've found I have a line of credit account still open with a small positive balance. This LOC was previously used as the deposit on an IP (30K). The original property used to draw the equity down for this LOC is now with the new financial institution.

1. Has the bank already cut of the supply of credit to this account?
2. If I ask them will it wake them up and allow them to cut off the supply?
3. Should I just try using the account as another deposit to find out?

Thanks
Rick
 
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Reply: 1
From: Jakk Bass - The SLUM LORD


G'Day Rick,

In 1995 I sold a property that had an Equity Loan (LOC) over it for $80,000.
The Sale price was around $120,000 and I had the lot put into the LOC and there was a positive balance of approx. $40,000 in there for a few weeks.
I suspected that the LOC had not been cancelled even though there was no security being held by this bank (one of the big four).
I wrote a cheque out from this LOC for an amount of the positive balance plus an additional $5,000 just to see if they honored it and deposited it to my everyday cheque account.
Guess what? It was honored.
I waited a few weeks and then wrote a cheque out for nearly the maximum of the LOC.
Once again they honored it.
It is now 7 years later and I still owe near the maximum of this LOC and the bank still haven't woken up to the fact that there is no security for this LOC.
If I was you I would keep quiet about it and see if you can draw against it like I did.
I don't know the legalities of this, I just keep paying the interest and the property I bought with these funds has so far made me a capital gain of over $70,000.
By the way, I now have another LOC on this property. I just figure this was one of lifes lucky breaks.

regards and Good Luck
Jakk
 
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Reply: 1.1
From: Owen .


I don't know what bank you have the LOC with but if you have 'net access to the accounts it's easy to find out. In one column you will have the balance (a few dollars in the black in your case), in the next column you will have available funds. If your credit limit is still available then your available balance will be $30k and a few dollars.

Easy.

Owen

"Gambling promises the poor what property performs for the rich – something for nothing"
 
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Reply: 1.2.1
From: .watto .


Can i have a couple of those LOC's, PRETTY PLEASE Rolf!!!!!

Cheers
Watto
Melb Freestyler
 
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