My policy is to identify the people I write about in this column, or who send me questions I address here.
No exceptions, except my own clumsiness in this particular case. To keep my e-mail account from crashing, I inadvertently deleted the name of the sender of these questions, and could not retrieve it by the usual means.
But I considered the questions interesting enough to pose them to some mortgage brokers who have been helping me slice through the misinformation being fed to borrowers.
The writer owns a home, on which he has a $200,000, 30-year conventional mortgage with an interest rate of 6.125 percent. He said the house was valued at several times his mortgage balance.
"I desire to refinance for a lower rate only, taking no additional cash," he said. "I'm having no problem with that. My issue is that I also have a variable-rate equity-credit line through a different bank, on which I have an outstanding balance of $90,000.
"The deal on the equity line is very good - prime rate minus 1 percent for the life of any balances, which is 2.25 percent.
"The problem is that this bank is telling me that if I refinance, which I understand is effectively satisfying the original mortgage and taking out a new one, that by virtue of satisfying the original mortgage, the equity line would jump into first-lienholder position, and they would agree to subrogate their credit line into second position."
The writer understands that the primary mortgage must be in first position, but it does so "only under new, substantially less-favorable terms for me."
"I tried to explain to them that refinancing my mortgage to a lower rate (I can likely get 4.75 percent with zero points) only makes my overall ability to satisfy my debt easier, reducing their risk."
They were unmoved "and clearly want to stick me with their higher, current rates. To give up my current favorable terms on the equity line is a deal-breaker."
His questions: Can the lender do this? Is this normally the way this works? Is there any way to get around it?
Jerome Scarpello, president of Leo Mortgage in Ambler, replied that, yes, the lender can, indeed, do this.
"The second lender may take this opportunity to change terms," Scarpello said. "You'll need to check the original paperwork, but it probably says that it is subject to change if the loan factors change or are based on their 'loan-to-value' ratios or other calculations."
Scarpello said he knew of some lenders who reduced the limit on home-equity lines of credit because, the lenders say, "of the decreased value of the collateral."
This is, he said, not the way lenders typically operate. But these are different times.
"Most lenders will subordinate after reviewing the facts of the new first loan, provided that their positions aren't weakened," he said.
"The best thing to do is to refinance the home-equity line of credit as well as the first mortgage. Based on your equity position, you may be able to find another home-equity line of credit with similar terms."