Line of Credit - is my money gone forever?

Hi all,
I was hoping someone more cluey in banking and finance than me could help me with a small dilemma -

Basically I have had for a few years what I thought was a line of credit against an investment property (only $40,000 or so) which I recently started putting my excess salary into to bring it back to no debt owed for the purpose of using it as a deposit on my next IP. Final $200 owing was deposited during the week and today i went to my internet banking page and instead of seeing that I have $40,000 available and nothing owing I see that there is nothing there at all - I have $0.00 owing, but also $0.00 available for redraw either!

I can still see the loan but no funds - is this right? Surely whatever money is deposited into a line of credit should remain available for redraw even once you pay it all back to $0?

I haven't been able to contact the bank as their call centre is only M - F but just want to know from somehone who knows how banks work, has all my savings over the past 3 months gone forever or can I somehow get access to it again somehow without needing to refinance the property and setting up a new LOC?

I'm having a bit of a panic as I have signed a contract for a new property and now don't have a deposit ready on hand! I'm currently refinancing another property to lock in the equity into a new LOC, but seriously doubt it will be ready and available in time to provide the deposit for the new IP, plus I won't be able to show regular savings.

In hindsight I should have left the last $200 owing to keep the LOC open but I didn't realise they would close it once it was paid off. :(
 
Thanks Aaron,

Looks like I'll need to try and refinance that particular property again. And never make the mistake of paying the last remaining portion off a loan again :D
 
I wouldn't have thought so myself so I'm thinking I made an error way back when applying for the LOC.
Is there any other way that a bank will release the equity in a property besides through a line of credit i.e as a stand-alone loan for instance?
 
I wouldn't have thought so myself so I'm thinking I made an error way back when applying for the LOC.
Is there any other way that a bank will release the equity in a property besides through a line of credit i.e as a stand-alone loan for instance?

Yes a bank can easily add a second stand alone loan on top of what you already have.
 
Standalone top up loan is definitely achievable. I prefer setting these up as they're cheaper for the client and better policy.
 
The bank is ME Bank, the info on my internet banking page is:

Account Name:Investment Loan
Product Name:SMHL Interest Only Investment Loan
Account Number:XXXXXXXXXX
Balance: $0.00
Available: $0.00
Account Type: Loan
Interest Rate: 5.63% p.a.
The minimum Redraw amount is $500.

I'm guessing it was not a LOC either, despite the fact I made it clear to them at the time I wanted a line of credit to fund further investments.
 
The bank is ME Bank, the info on my internet banking page is:

Account Name:Investment Loan
Product Name:SMHL Interest Only Investment Loan
Account Number:XXXXXXXXXX
Balance: $0.00
Available: $0.00
Account Type: Loan
Interest Rate: 5.63% p.a.
The minimum Redraw amount is $500.

I'm guessing it was not a LOC either, despite the fact I made it clear to them at the time I wanted a line of credit to fund further investments.

ThIs is not a LOC
 
The bank is ME Bank, the info on my internet banking page is:

Account Name:Investment Loan
Product Name:SMHL Interest Only Investment Loan
Account Number:XXXXXXXXXX
Balance: $0.00
Available: $0.00
Account Type: Loan
Interest Rate: 5.63% p.a.
The minimum Redraw amount is $500.

I'm guessing it was not a LOC either, despite the fact I made it clear to them at the time I wanted a line of credit to fund further investments.


Me don't have an loc style product I don't think

Ta

Rolf
 
Until loan paid off in full :)

Exactly :(

Luckily I am currently refinancing another property so hopefully this will come through in time to finance the deposit on the new property.

It feels like all my hard-earned savings have just been flushed down the toilet though.
 
Me bank do not have a loc but using the loan as a simple redraw facility would work just as well.

Thanks Aaron,

As the loan is still visible via internet banking does this mean it is not closed, and I can arrange for the funds to be made available again? Or would they expect to revalue the property etc etc and set up a whole new loan?

I will speak to someone at ME tomorrow who hopefully knows what they are doing and can help me out. Not overly confident though.
 
Hi Nat

I don't know about ME but other lenders can easily reinstate the loans - usually via a phone call or a form. Just give them a buzz and hopefully it's not too painful a process.

Cheers

Jamie
 
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