Chase Home Equity Loan for Many Miles
 

There is a great loan that Gary links from his Free Frequent Flyer site. Chase is offering "Earn 4,250 miles for every $10,000 financed". I am in the process of completing my loan and will keep you posted but this is what they have told me. The loan application took 15 minutes the appraiser took an hour.

No Points, No Fees, and first year Admin cost ($75/yr) is waived. Interest rate is Prime for loans under $200K and Prime +1/4% for loans from $200K-$500K.
What ever I initially fund with the Equity line will determine my United Miles and I can then pay down the loan. I am not concerned about rates going up because I am paying off the loan after it funds.

Due to lots of equity I am getting the maximum loan for $500K and will get 211,500 miles and pay the loan off the after it funds. The loan agent said that I can then borrow on my rental with the same terms and interest rates. As long as you start the loan process by July 31st you will receive the bonus miles (4250 per $10K borrowed vs 1250 per $10K borrowed)

With the two loans my interest cost will be ~ $600 and I will receive 425,000 United Plus miles.

Anyone with equity in their home or rental should take advantage of this offer.

http://www.united.com/page/article/0,6722,50776,00.html :)

How about some thing more
 

Good if you don't need the money. But I would recommend you visit the finance section of fatwallet. There are some threads there about taking HELOC for low rates and then putting the money in CDs and making money due to the interest differential. The discussion mentioned some thing like 10-20K over a period of 5 years with 200K loan. Interest rates may have changed since then, but still worth looking into and sure will beat 500K united miles which is probably worth five grand.(Well in my poor economy travel sense)

Just my 2 cents...

Prasad

Good if you don't need the money. But I would recommend you visit the finance section of fatwallet. There are some threads there about taking HELOC for low rates and then putting the money in CDs and making money due to the interest differential. The discussion mentioned some thing like 10-20K over a period of 5 years with 200K loan. Interest rates may have changed since then, but still worth looking into and sure will beat 500K united miles which is probably worth five grand.(Well in my poor economy travel sense)

He is talking about a HELOC ( Home Equity Line Of Credit ). It is worth 1,250 per 10k financed.

But the risk with a line of credit is tha tthe rate changes as interest rates rise. So you might be able to get a 5 yr CD paying 6% right now and only be paying 4% on your line of credit, but what happens when Prime goes to 6 or 7% ? Then you are losing money ( 6% of CD but paying 6-7% on your line of credit)

Borrowing short term and loaning long term is exactly how the Savings and Loans got into major trouble.

The United - Chase Equity Loan bonus of 5250 per 10,000 borrowed has been extended from July 31st to September 30th, 2004.

http://www.united.com/page/article/0,6722,50776,00.html

My loan should close next week (they send the notary to your house) and the loan processor said they will pay of my other line of credit and wire the money to my account. They will also let me pay down the line of credit with a wire transfer so I hope my interest cost will only be one or two days.

After I do my rental line of credit and pay this loan off I may do the E Loan line of credit ($200 loan fee, Prime - 1/4%). I agree with Gary that this process will maximize my miles and min. the interest rate cost and risk. I may get 600,000 miles in a year with 4 loans and very little cost (< $500).
:)

Does anyone know if we can do a similar thing- that is a home equity line and get AAdvantage miles?

On the Free Frequent Flyer web site http://www.freefrequentflyermiles.com/index.htm

Under Finance --> Home Buying

AA has these:

American Airlines.
Wells Fargo Bank mortgage program.
Cendant Real Estate. Miles for choosing one of their real estate agents, and for moving.
SIRVA. Miles for choosing one of their real estate agents, and for moving. More info here.

The best deal gives you 1,250 miles per $10,000 borrowed (vs the 4250 for the Chase-United deal)

some questions ....
 

Thanks for sharing your experience.

Questions:
1. "...no point, no fee ..." Do you mean no closing cost at all?

2. If you have first mortgage going on, are you able to do so?

3. Is there any prepayment penalty since you pay off right away?

4. Is there any early closing account penalty?

5. How long does it take for the whole process, on-line only without live person contact?

6. How soon will the miles be posted in you acct?

I do not know. When the loan closes (next week) I will call and ask.