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Understanding Subordination

Maximize your options

Here’s what you need to know about keeping your home equity line of credit open when refinancing.

With low interest rates, many homeowners like you are choosing to refinance their first mortgages. Typically, the bank refinancing your first mortgage will pay off and close your home equity line of credit account. However, you may be eligible to refinance and keep your Wells Fargo home equity account open — allowing you to keep your current home equity line of credit account interest rate, terms, and access to funds — through a process called "subordination." Wells Fargo may agree to move your home equity account to the second lien position on your property, after your new first mortgage.

Subordination questions

What is a subordination agreement?

It's a contract between your first mortgage lender and your home equity lender. It allows your home equity lender to agree to remain in the second lien position on a property behind a new first lien mortgage.

Is subordination a difficult process?

Whether your first mortgage is with Wells Fargo or another lender, we'll work with that institution on your behalf to make the process as simple as possible. Often, all the information needed will be available from your mortgage lender and the title company. The process usually takes approximately 25 business days.

How do I benefit from keeping my home equity account open?

By maintaining your current home equity account, you may be able to keep the current interest rate and terms and conditions, all of which may be potentially more favorable than if you close it and apply for a new account. Plus, you'll keep your current account number and avoid the hassle and fees involved in applying for a new account.

If I have a $0 balance on my line, can I keep my account open?

Yes, even if the balance is $0, whether paid down or consolidated during the refinance process, you may still be able to keep your home equity account open for future use.

What is the advantage of subordination over applying for a new account?

Any new home equity account requires an application process that typically includes credit checks and multiple forms. Lenders may also charge fees, and states and localities may charge recording fees or taxes. On the other hand, the subordination process does not require a new application and often does not require credit checks other than what your first mortgage refinance lender has provided. It may have only a low processing fee.

Who can I contact for more information?

Call a Wells Fargo Home Equity Specialist today at 1-800-216-2408 to discuss your options. If you’re talking to a home mortgage lender about refinancing, be sure to ask about subordination as an option to keep your current home equity account open.

Call us at 1-800-216-2408 to discuss your options

First mortgage

A first mortgage is typically the primary loan you originally used to buy or refinance your home or other real estate — it's often a much larger amount than a home equity loan or line of credit.

Home Equity or Second Mortgage

Typically a second mortgage — a smaller loan or line of credit borrowed against the equity in your home to help you make home improvements or use toward a down payment for a home.


A legal claim or attachment against property as security for payment of an obligation.