Are you looking to free the equity currently locked into your home due to rising house prices? A home equity loan may be the answer. Apply today using the form below and get a great quote from up to 3 different lenders with no obligation!
Home Equity Loans Can Give You Peace of Mind
When you initially took out your home loans, you might have found the experience to be daunting. After all, a financial institution might have been entrusting you with $100,000, $200,000 or $300,000. You realized, however, that buying a home was a tremendous investment in your future and you were willing to assume the risk that mortgage loans entail.
Now, you realize that your home needs some major repair work. But you don't have the cash on hand to pay the expenses out of pocket. Therefore, you're wondering if home improvement loans might be appropriate in your particular case. You may even be wondering whether bad credit home loans are a reasonable option.
First, it's important for you to understand exactly what a home equity loan is. Simply put, it's a line of credit that enables you to borrow money against your house. If you were to default on the debt, the lender could take your house away. Meanwhile, the term "equity" refers to the gap between the worth of the house and the amount owed on the mortgage.
How Does A Home Equity Loan Work?
When you have need of cash for a large project or purchase, you may be able to use the equity
that you have built up in your home. The longer that you have lived in your home the more
equity you would have.
In general, home equity debt can be classified in two ways: home equity loans and home equity lines of credit. Both are often called second mortgages. A borrower usually has less time to repay a home equity loan or line of credit than he or she has for the initial 30-year mortgage. For instance, the borrower may have only 15 years to repay a home equity loan.
There are numerous reasons for the popularity of home equity loans. One of the primary selling points is the interest rate, which, while higher than primary mortgage rates, is often lower than the rate charged on credit cards and personal loans.
Another key advantage of a home equity loan is the fact that the mortgage interest is tax-deductible. As a result, you can borrow up to $100,000 in a home equity loan and end up with a significant tax break. Consequently, a home equity loan can be a godsend to your finances. It provides you with the money you need without causing you to sacrifice a great deal of cash in terms of fees.
At times, however, you may want an alternative to the traditional equity loan or line of credit. Therefore, you might consider the cash-out refinance. This is only appropriate, however, if mortgage rates are low and property values are high. In the beginning of the decade, that was the state of the housing market, so cash-out refinancing made sense. The way it works is this: You refinance your primary mortgage for an amount higher than the outstanding balance.
A home equity loan may not be the solution to all of your financial problems. However, in certain circumstances, it may be absolutely the best way to address pressing financial needs. As a result, a home equity loan can become an important part of your short-term financial planning. And, once the loan is paid, you'll have the satisfaction of knowing that you've once again proven your credit worthiness.
Rebuild.org brings you the latest news headlines related to Home Equity:
- Should you get a personal loan or home equity loan?
There are pros and cons to getting an unsecured personal loan or a home equity loan that uses your house as collateral.
[June 2nd, 2011]
- Home loans tied to Prime Rate index may see higher rates in 2012
The prime rate is forcasted to move higher in 2012. Should you protect your home equity loans from increased monthly payments?
[March 13th, 2011]
- Home equity loans: A home value update
Nothing affects home equity loans like home value trends. Read the latest from both the National Association of Realtors and the S & P / Case Schiller reports to find out where home values are currently.
[February 27th, 2011]
- Home equity loan news: Greenspan speaks about home values
According to former Federal Reserve Chairman Alan Greenspan, home values need to rise about 10 percent. Use regained home equity to secure a cheap, fast loan.
[February 13th, 2011]
- Recent news that will effect interest rates on home equity loans
Several economic reports came out recently that may effect the interest rates you pay on home equity loans. Make good financial choices by paying attention to changes in today's economy.
[January 30th, 2011]
Recent articles related to Home Equity:
- Glossary of terms related to home equity loans
Following is a list of terms along with an explanation of their meaning. The list will help you understand any conversations you may have with a home loan lender. It can also serve as a good reference when you sit down to fill out your loan application paperwork. Apply for home equity loans now. Amortized - This term relates [...]
[March 5th, 2011]
- 5 Things to remember when shopping for home equity loans
Home equity loans are cheap loans for financing a number of life’s needs, such as college tuition, home improvements, or debt consolidation. If you have been considering tapping the equity in your home, stop to consider these 5 things before you start shopping around. Contact a home loan professional today. 1) How much money do you need? Whether [...]
[February 20th, 2011]
- Home equity loans vs reverse mortgages
Seniors who want to use the equity stored in their homes to improve their cash flow, should consider the advantages and disadvantages of both a traditional home equity loan and a reverse mortgage. Following is a brief summary of the key features of each type of loan. Consider carefully which of these loans makes the best financial sense. Advantages of home [...]
[February 6th, 2011]
- Understand the terms of home equity loans
A big part of why the housing sector of the economy crashed a few years ago had to do with people taking out loans they didn’t understand. Don’t ever let that happen to you. Consumer protections are in place, such as, the terms of home equity loans being required to be given to you in advance. Knowing those [...]
[January 23rd, 2011]
- Home Equity Loans: Fixed Seconds vs. HELOCs
When it comes to home equity loans, you have choices. The two most common types of home equity loans are the fixed second and the HELOC. Which option you choose will depend, in large part, on why you want to access the money. Fixed seconds - One type of home equity loan is often referred to as [...]
[January 9th, 2011]