I have a question regarding a MN Mortgage, I'm in SD. One of the lenders at one of our branches has a home equity line of credit on a customer's home in Minnesota. At the top of the document, it states "Mortgage with future advance clause (for revolving LOC)." He wants to know if he can tie back to that mortgage if he refinances the loan into a closed end ARM product. My thought is no, as it appears it is specific to open end products, but I thought I would ask the experts.

Thanks!

If he is refinancing the HELOC into a closed-end product, he can modify the original mortgage. If he was doing a closed end loan separate from the HELCO then he would need a new mortgage for the closed-end.

Thank you very much. That is the answer he was hoping for.

Have a great day!

If we refinance a closed-end mortgage into another closed-end mortgage, can we do a modification of mortgage or do we have to satisfy the existing mortgage and do another mortgage? We are trying to save the customer some money by not having to pay the mortgage registration tax.

If there are no additional funds, you can just reference the old mortgage on the new loan docs. If you are adding additional funds, you would have to modify the mortgage to increase the mortgage amount. The customer then only has to pay mortgage registration tax on the new money.