AAA Home Equity Line of Credit

Frequently Asked Questions

Q: What is a HELOC?
A HELOC is a home equity line of credit. It is a loan, using your home as collateral, that lets you borrow up to a certain amount, rather than a set dollar amount. A HELOC acts like a credit card: It has a credit limit, and you can borrow against it, pay all or part of the balance, and borrow again up to the credit limit. The interest rate varies with the prime rate. You will receive advance notice if there are any changes to your rate.
Q: What is the difference between a HELOC and a home equity loan?
With a Home Equity Line of Credit, you withdraw money as you need it up to a predetermined limit and repay the loan over a period of time and with a variable interest rate that may increase or decrease over time. There is a fixed "draw" period, during which funds continue to be available for withdrawal as the balance is paid down, followed by a fixed repayment term. You only have to make minimum interest-only payments during this period. A home equity loan is a fixed-rate installment loan that has a set loan amount borrowed with fixed monthly payments. Auto Club Trust, FSB also provides home equity loans.
Q: How does a HELOC work?
The first 10 years of a HELOC is known as the draw period. During the draw period, you may borrow funds from the HELOC and are only required to pay the minimum interest-only monthly payments. You may also choose to pay more each month and pay down your balance.

After the draw period ends, the repayment period begins. The repayment period is 15 years. During the repayment period, you can no longer make draws from your HELOC and you must make monthly payments based on your balance due, so that the entire loan is repaid by the end of the period.
Q: What will my monthly payment be?
This is a variable interest rate product. Your minimum payment can vary during both the draw period and the repayment period.

During the draw period, your minimum monthly payment will be the interest on your current balance (any funds you have drawn from your HELOC). If you draw $50,000 and your interest rate is 6.00%, then your minimum payments during the draw period will be $250.00 a month. When the draw period ends and your balance due is $50,000, then during your repayment period your payments will include the principal amount plus interest in an amortized schedule, which will end up being $421.93 a month.

During the application process we will provide important disclosures about this product that you are encouraged to carefully review.
Q: How do I get a HELOC?
If you have equity in your home, have fairly good credit and have enough income to make monthly payments on what you borrow, click "Get Started" at to get pre-qualified.
Q: How can I estimate the value of my home?
Visit and enter your address to get a Zestimate® on your property. A Zestimate® is Zillow's estimated market value for individual homes, computed daily based on recent sale prices of similar homes in your area.
Q: How is my total line amount calculated?
The total line amount is calculated by determining the difference between the value of your home and the amount you owe on your house (aka the equity you have in your home). The total line amount can be up to 89.9% (depending on qualifications) of the equity amount in your home. Auto Club Trust, FSB will order an appraisal on your home to determine the exact value of your property which is used to establish your maximum line of credit amount.
Q: What are the advantages of a HELOC?
HELOCs often have low interest rates compared to other available forms of debt. You control the interest costs on your line of credit since you only pay interest on what you borrow.
Q: Are there any drawbacks?
If you don't repay the HELOC, the lender may foreclose on the house. If you use a HELOC to pay off credit card debt, there is the risk that you'll just charge up the credit cards again, putting yourself deeper in debt. When the draw period ends and the repayment period begins, the minimum monthly payment could be significantly higher than the interest only charges.
Q: How do I get pre-qualified for an offer?
First, we will ask you some information about yourself and your property. We will perform a soft hit on your credit report, which has no impact on your credit score. To determine your pre-qualified offer, we will consider your credit score, your debt-to-income ratio, and property information. Once you accept the offer and apply for credit, we will begin the underwriting process with a loan officer.
Q: What will I need to submit to Auto Club Trust, FSB?
Once you have accepted your pre-approved offer and decide to apply for credit, we will need certain documentation from you. It is best to have this documentation prepared ahead of time to speed up the application process. All applicants must submit the following:

Proof of Identity - Driver's license, passport or any unexpired, government-issued identification that proves nationality or residence and bears a photograph or similar safeguard.

Proof of Income - The following documents are the most common forms used to show proof of income.

For W-2 employees: You must provide a copy of your most recent pay stub. The pay stub must be computer-generated, include year-to-date earnings and taxes withheld, contain no alterations, and must have been issued within 30 days of the submitted date. To include overtime, commission, and bonuses, a written verification of employment is required.

For self-employed: You must be self-employed for at least two years, and be able to submit your previous two years of tax returns with all schedules including W-2s, 1099s, and K-1s. Please note, in order for 1099 income to be considered "self-employed," you must have selected "self-employed" as your employment status when submitting your information.

Social Security Benefit / Permanent Disability: In order for social security benefits or permanent disability to be accepted, you must submit either (1) a copy of your most recent dated awards letter with your name or social security number or (2) a most recent bank statement showing the direct deposit.

Pension: In order for your pension benefits to be accepted as income, you must submit a most recent 1099 or two months of most recent bank statements showing the direct deposit.

All other sources of income must be submitted as two years tax returns with all schedules and most recent asset statement as applicable.

Mortgage Statement - If you have an existing balance on a mortgage, you must submit your most recent statements issued to you by your financial institution.

Proof of Insurance - You must submit the declaration page provided to you by your home owner's insurance company. This page will show all the details of your policy.

Other documentation that may be required of you:

Second Mortgage Statement - If you have a second mortgage on your home, you must submit the most recent statements issued to you by your financial institution. You will also be required to pay off the second mortgage with the funds from your HELOC.

Flood Insurance - If you live in a designated flood zone, you must submit the declaration page provided to you by your insurance company.

Refinancing your first mortgage - If you are using your HELOC to refinance your first mortgage, we will need the name, phone number and account information of your financial institution so that we may pay off your mortgage.
Q: How can I submit my documents?
A loan officer will work closely with you in order to have all the appropriate documentation submitted. Documents may be submitted electronically via email, by fax; or, sent to us by express mail. The loan officer you’re working with will discuss which method is the best for you.
Q: I am self-employed, will I qualify for a HELOC?
You are eligible for a HELOC if you have been in business for at least two years and can supply documentation of income.
Q: What types of properties are eligible for a HELOC?
We offer HELOCs on single family, detached homes that are used as the primary residence of the borrower. We cannot consider applications for leaseholds, mobile or manufactured homes, log homes, timeshares, 2-4 unit properties, properties greater than 10 acres, unimproved land, or trust-owned properties not held in the family trust.
Q: Do I have to live in the property?
Yes, Auto Club Trust, FSB requires that you live in the property.
Q: Can I apply with a co-borrower?
Yes, you can apply with a co-borrower. To complete the online process, your co-borrower must also be on the title for the property. If you would like to add someone else as a co-borrower, please call 844.897.2265.
Q: What happens during closing?
You'll review and sign your line of credit documents, which may vary by state. After you sign your documents, you'll have three business days to change your mind and cancel your line of credit. This three-day period is called your "right to rescission." After these three days, you'll be able to access your line of credit.
Q: How do I access my funds?
You may access your funds by any of the following methods:

  • Account Checks
  • Phone request
  • Online Banking transfer requests
Q: What are the basic guidelines for getting a HELOC with Auto Club Trust, FSB?
Talking with one of our loan officers is the best way to get an initial idea of your eligibility, but here are a few things we look for:

  • History of responsible credit use
  • Verifiable employment and income
  • Sufficient equity in your home