2nd house home equity via mortgage

<p>My mother in law had cancer the last year of her live that cost us $250K. In order to save their house we put their house in our name without realizing the consequences of this. Below I run the results of this second home on profile net price calculator. Do colleges accept a home equity line of credit at the various sizes I show below? I would only have to borrow against the line of credit. Or do the colleges require a take out a second mortgage in the home?
impact of house house value what we pay size of mortgage
no morgtage $600,000 $40,291 $0
level $600,000 $30,291 $200,000
level $600,000 $25,291 $300,000
level $600,000 $20,291 $400,000
level $600,000 $6,110 $500,000</p>

<p>I think the answer is colleges only look at what your have borrowed on home equity line of credit, not the total amount, so I would have to take out a true mortgage on the house. Does any body have any suggestions what to do about this second home where my father in law still lives?</p>

<p>Its been a while since I filled out the PROFILE, but you are right, they are going to jump on the fact that you have a " 2nd home". However, you should be able to talk directly with the financial aid offices and explain the circumstances.</p>

<p>They also want to know what you could sell it for & how much is actually owed on the loan, so if you only have out a " $30,000" equity loan, then put that, even if the amount you could borrow against is higher.</p>

<p>Meet, asap, with a financial planner who understands college aid (which is not the same as just a financial planner). This is a tricky wicket and you have to take into account not just your student and father in law, but also any younger siblings and the time horizon to your retirement.</p>