Quote:
Originally Posted by photon
They see the line of credits as revolving (which they are), so when they're doing their debt service ratio tests they use either a portion or the full available amount.. I can't remember exactly.
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Both matter. As well, the utilization matters (if you've drawn $20k on a $50k HELOC it's more favourable than say $45k on a $50k HELOC).
You'd be surprised how much a bank will care if you have $25k on each versus $50k on one and $0k on the other. Bizarre and a weird part of their risk calculations, but it does matter. You want as low of a utilization rate on both of your HELOCs. You could have the same amount of debt, but if you've nearly maxed out any line, it's a concern for a bank.