question about HELOC and Credit

[aeycue13]

Hello.  I just paid off the 20 (HELOC) of my 80/20 I got 10 years ago.  (whoooooo!).

In Feb 2012 (pre-mustache) we refinanced our interest-only, underwater mortgage and because of that the HELOC/20% had to be re-subordinated.  In order for the bank to agree to do this, they froze the credit portion of the heloc.  It didn't matter to me then, and honestly it doesn't really matter to me now, but when I called to get a payoff amount they asked me if I wanted to close the account or keep it open.  I said, "well, do I even have credit on this loan anymore?  how much?".  They said no, but do you want to get that turned back on again and gave me a banker's name and number.

The original HELOC was ~38000 @ 5.74%, I now have ~150000 left on my main mortgage at 4.25%, and zillow says the house is worth around ~170000. 

So is it even worth it to get the line opened up again?  They're not going to give me access to the original 38000, right?
I may want to do an addition on the house sometime in the future (5 years?) but there are SL debt emergencies to deal with first.

Also, does closing out this loan adversely affect my credit?  (I'm not sure if I care about that either as I won't need any credit until if/when we were to do the addition).

Thanks for your insights!
 

[Cheddar Stacker]

Welcome to the forum!

Congrats on the loan payoff. A heloc would likely only give you up to 95-100% of the value of the house, bu they likely wouldn't use zillow to determine FMV. You can find a HELOC for 4% interest with a $50 annual fee so if you want/need one shop around.

It doesn't hurt to have one. If you wait until you really need one to obtain it you might get lesser terms than if you go in with a position of not even needing it.

[aeycue13]

Thanks for the reply!  I think I'll call the banker and see what they can do if nothing else just for my own curiosity and knowledge. I have to either open it or close it at this point, so I have to be in touch with them anyway, but barring a ridiculously easy and good deal I'm probably just going to close it out.  My credit card actually has a better rate than that loan did anyway. 

Thanks again!