HELOC Plus.
An interest-only home equity line with a 10-year draw period
Ask JMAC about HELOC Plus
Brokers often ask
Answers come from JMAC’s guidelines. Leave out names, addresses and loan numbers.
For licensed mortgage professionals. Not an advertisement to consumers.
Key figures.
- Score from
- 660
- HCLTV up to
- 89.99%
- Lines to
- $1.5M
- Years to draw
- 10
Stand-Alone purchase
Purchasing a home with a low-rate HELOC.
No home to borrow against? Not needed. Help your first-time buyer afford their dream home.
A low-rate HELOC with interest-only payments makes buying a home more affordable.
Why buyers want it
- Interest-only payments for the first 10 years, then 20 years to repay.
- No asset sourcing, unless assets are used to qualify income.
- Pay down principal any time, and draw again in the first 10 years.
- Up to 80% of the home’s value on a primary residence at 720+.
- The highest wage earner’s score, from one bureau or a tri-merge. VantageScore 4.0 accepted.
What it takes
- Good credit: 680+ (720 for a second home). The highest wage earner must meet the minimum
- Income: two years of income history required for wage earners and self-employed borrowers
- An AVM supporting the value for lines up to $400,000, otherwise an appraisal; use the lower of purchase price or value
- DTI up to 45% (40% for a second home). Qualify on a 30-year principal-and-interest payment for the full line at the start rate plus 2%, so it isn’t built for high-DTI files
Four structures.
Stand-Alone purchase
Buyers who want a line instead of a first mortgage
A 1st lien line, the home’s only lien.
Manual underwriting, from 680 (720 on a second home)
Value is the lower of purchase price or appraisal. It can pay off a current first, too; no subordination.
Stand-Alone 2nd lien
Homeowners who want to keep their current first
Sits behind the current first mortgage.
Manual underwriting, from 680 (720 on a second home)
Apply more than 180 days after any transaction on the property.
Piggyback 2nd lien
Buyers below 20% down; refis with a new first
Closes with a new first mortgage.
DU or LPA, the same AUS as the first, from 660
Approve/Ineligible or Accept/Ineligible findings, for loan amount only.
Post-Close Piggyback 2nd lien
Borrowers who just closed a new first
Earliest 30 days after a new first mortgage funds.
Same limits and AUS as Piggyback, from 660
Apply within 180 days of the first’s funding. The first’s appraisal can be reused.
Limits at a glance.
See the full matrix in the guidelinesPrimary residence
| Score | Piggyback / Post-Close Piggyback | Stand-Alone 2nd lien | Stand-Alone 1st lien |
|---|---|---|---|
| 720+ | 89.99% | 89.99% | 80% |
| 700-719 | 89.99% | 85% | 75% |
| 680-699 | 89.99% | 80% | 70% |
| 660-679 | 85% | Not eligible | Not eligible |
| Line | $75K to $500K* | $75K to $500K | $75K to $1.5M† |
| Max DTI | 45% (50% at 760+) | 45% | 45% |
| First + line | Up to $3M | Up to $3M | Does not apply |
* Up to $750K at 720+ and 85% HCLTV.† Above $1M, 70% max HCLTV.
Second home
| Score | Piggyback / Post-Close Piggyback | Stand-Alone 2nd lien | Stand-Alone 1st lien |
|---|---|---|---|
| 760+ | 89.99% | 80% | 70% |
| 720-759 | 85% | 80% | 70% |
| 700-719 | 85% | Not eligible | Not eligible |
| 660-699 | 80% | Not eligible | Not eligible |
| Line | $75K to $500K | $75K to $250K | $75K to $1M |
| Max DTI | 40% (45% at 760+) | 40% | 40% |
| First + line | Up to $2M | Up to $2M | Does not apply |
Property, state and borrower rules can lower these. See every rule in the HELOC Plus guidelines
Where it helps.
No condo questionnaire
Condos don’t need a questionnaire or CPM. With a full appraisal, the underwriter reviews any concerns.
No asset sourcing
Verify assets only if they’re used to qualify income.
One bureau, VantageScore 4.0 accepted
Stand-alone lines can use one report from Equifax, TransUnion or Experian, without a tri-merge. VantageScore 4.0 is accepted. Use the highest wage earner’s score, including a non-occupant co-borrower’s.
No appraisal on most lines up to $400,000
No appraisal is needed for lines up to $400,000 when the JMAC-ordered AVM supports the value. An exterior-only appraisal is also eligible up to $400,000. A full appraisal is required above $400,000 or when the AVM returns no value.
First’s title work for smaller piggybacks
Piggyback lines of $250,000 or less that close with the first use its title work, with the line on its policy. Post-Close lines need their own title product.
More borrowers fit
Non-permanent resident aliens are eligible with a W-8. A non-occupant co-borrower can join the loan, but not as the primary borrower.
What to submit.
Piggyback and Post-Close Piggyback
- AUS findings, from the same AUS as the first
- Income documentation, per the AUS findings
- Two months of assets, only when used for income
- Preliminary title report
Stand-Alone 1st or 2nd lien
- Two years of W-2s and current paystubs
- Two years of tax returns, if self-employed or with rentals
- Two years of K-1s for any company ownership
- Two years of business returns at 25% or more ownership
Every file
- Credit report, good for 60 days from submission
- The first lien’s Note and mortgage statement, when there is a first (not on piggybacks)
- For other properties owned: mortgage coupon, tax bill, insurance declarations with the premium, and any HOA bill
- W-8 for any non-permanent resident alien borrower
- Affiliated business disclosure, if it applies
What to know.
- Qualifying payment
- 30-year principal-and-interest payment on the full line, at the start rate plus 2%Interest-only payments during the 10-year draw, then 20 years to repay.
- Underwriting
- AUS for piggybacks, manual for stand-alone linesPiggyback and Post-Close lines need DU Approve/Ineligible or LPA Accept/Ineligible, for loan amount only, from the same AUS as the first; income follows the findings. Stand-alone lines need two years of income history.
- Credit
- The highest wage earner’s scoreUse the middle score, including a non-occupant co-borrower’s; with two scores, use the lower. Stand-alone lines may use one bureau. No frozen bureaus. VantageScore 4.0 is allowed.
- Property
- SFR, condo, PUD, 2-4 units, per Fannie MaeLeasehold per Fannie Mae. Ineligible: manufactured homes, co-ops, condo hotels, homes under construction or properties not typical to the market.
- Borrowers
- Citizens, permanent and non-permanent residentsNon-permanent residents need a W-8. ITIN, foreign national and borrowers from OFAC-sanctioned countries aren’t eligible.
- States
- MLO license required, Texas not permittedFind the states on the Licensing page, linked at the bottom of every page.
- Escrows
- NoneLine funds can’t go into the first mortgage’s escrow.
- First mortgage
- No interest-only or negative-amortization firstsAn assumable first is allowed.
- Qualification
- Full doc onlyNot offered: bank statements, P&L only, WVOE only, asset utilization, DSCR, ITIN, foreign national and recent credit event.
Each opens every JMAC program that takes that paperwork.
Questions brokers ask.
Which program fits my borrower?
Use lien position and timing. A Piggyback 2nd lien closes with a new first mortgage. A Post-Close Piggyback 2nd lien originates 30 or more days after a new first funds, with application within 180 days of funding. A Stand-Alone 2nd lien sits behind the current first, with application more than 180 days after any transaction on the property. A Stand-Alone 1st lien will be the property’s only lien.
How does HELOC Plus differ from the Closed-End Second?
HELOC Plus is a line with a 10-year draw and 20-year repayment. The Closed-End Second is a fixed-rate loan for a set amount.
Which first mortgages can a second-lien line follow?
The first can’t have interest-only or negative-amortization features. An assumable first is allowed.
Can a Post-Close line reuse the first’s appraisal?
Yes. It’s valid for 120 days from its effective date. After that, a recertification extends it up to 365 days from the effective date.
When is title insurance needed?
Piggyback lines of $250K or less that close with the first use its title work, with the line on its policy. Larger piggybacks, Post-Close and stand-alone lines need a JMAC-ordered insurable title product covering liens, vesting, recordation and gap.
Is there an early payoff period?
Six months (180 days) from closing. A zero balance doesn’t count as a payoff while the line stays open.
What DTI does the line allow?
Up to 45% for a primary residence and 40% for a second home; piggyback lines allow 50% and 45% at 760+. Qualify using a 30-year principal-and-interest payment on the full line, at the start rate plus 2%.
Which borrowers and states are eligible?
U.S. citizens, permanent residents and non-permanent residents (with a W-8), where JMAC is licensed to originate, except Texas. Non-occupant co-borrowers are allowed, but not as the primary borrower. ITIN, foreign national and OFAC-sanctioned-country borrowers aren’t eligible.
Bring us your next HELOC Plus loan.
Ask JMAC a question, send your scenario, or get set up with your lending team.