WETHERSFIELD, Conn.–Dutch Point Credit Union said it has become the first in the state to offer members a new Convertible HELOC, which it said offers cost savings and flexibility in a high-rate environment.
The loan allows borrowers with a HELOC to convert all or part of their home equity line of credit to a fixed rate home equity loan. Members who opt to lock in only a portion of their existing HELOC still have access to the remaining balance, the $465-million DPCU said.
The credit union added the Convertible HELOC enables them to customize their loan with the cost savings of a fixed rate loan and the flexibility to retain some of their credit line.
Flexibility Provided
“We see our new Convertible HELOC as an opportunity to save our current and future members a significant amount of money while providing them the flexibility to retain some of their line of credit at their discretion,” said Dutch Point Chief Member Experience Officer Anthony Sacchetti. “The Federal Reserve has increased interest rates 11 times since March 2022 to tame inflation. That translates to higher monthly payments and a higher cost to borrow money for consumers – especially those with a variable rate line of credit.
“If someone opened a HELOC two or three years ago, and they are still paying off their balance, their payments are significantly higher today, because the variable rate may have increased beyond their ability to make the monthly payments,” added Sacchetti. “The Convertible HELOC will give them a lower fixed rate and monthly payment.”
No Lock Fees
The credit union said the product has no lock fees or closing costs and borrowers will receive a discounted rate if the Dutch Point HELOC is the only loan on the home.
Dutch Point Credit Union has more than 23,000 members.
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