A co-worker and friend of mine told me an almost unbelievable story about his home equity line of credit with GMAC Mortgage.  He and his wife recently had their 4th child, and wanted to build an addition to their house.  They received a $50,000 line of credit with a small book of check to use to pay contractors.  At some point, they ran out of checks and requested more from GMAC.  Within a week or so, they received checks and the wife wrote a $5,000 check to a contractor, one of the final payments for the project.  Unbeknown to her at the time, the new set of checks was a sheet of MasterCard checks, not a HELOC check.  This unfortunate mistake caused a new MasterCard line of credit to be opened, with a 3% check-writing fee applied to the new balance.  My friend, who normally has a very calm and friendly demeanor, was understandably irate with this seemingly intentional bait and switch maneuver by GMAC.

This week I started shopping around for a mortgage to refinance my rental property.  I had originally purchased this property using a home equity line of credit (HELOC) on my primary home.   So the plan is to refinance the rental property and pay off the HELOC.   I had planned on waiting until working my FICO score back up above 700, thinking that would make a significant impact on loan terms. As of now, my FICO score as reported by Equifax is 696. With the recent drop in mortgage interest rates, I want to be sure to be ready, so I began shopping around. I checked a number of locations, including my local credit union, my insurance company (USAA, which also has a banking, credit card, and mortgage business), and the company I've used for my last two home refinances, www.internetmortgage.com, which is actually Bank of Blue Valley (BBV) out of Overland, Kansas. My credit union (Ent Federal Credit Union) had the best application process I've seen.  If you're like me, you get frustrated typing account information, knowing the bank pulls all that information from the credit reporting agencies anyway.  Well, Ent pulls the information right into the application, after confirming that its OK to check credit.  Very refreshing.