- When considering if and when to use a home equity loan, it's important to know the potential benefits that a home equity loan or home equity line of credit (HELOC) can offer. Here are three for you to consider:, Lower Interest Option, For some people, home equity can offer a lower interest rate than other types of loans. This can be helpful when considering education costs, large purchases, or managing debt. Check current interest rates ., Flexibility, There are two options when tapping into the equity that's been built up – a fixed-rate home equity loan or the line of credit (HELOC). And HELOCs are structured for extra flexibility. Instead of receiving a lump sum, there is an amount of cash available to the borrower to take when needed during the withdrawal period. So, if an unexpected expense arises, you could take the amount to cover the…, Countless Potential Uses, Home equity loans can be used for any purpose. That means they can be a financial solution for people in many situations. It's always good to know you have options. If you want to know more, you can read about the top uses for home equity loans .
- Home Equity Loans for Home Improvement, Using home equity for home improvements and renovations is a popular choice. First, the home equity loan can be used for costly repairs such as roofing, foundations, or other vitally important parts of your home. That makes home equity loans an option for keeping your home safe, secure, and functional. Second, home equity loans can be used for home improvements that increase the value of your…, Using Your Home's Equity to Invest, Sometimes people will use the equity built up in their home for investing. By doing this, people are looking to take advantage of their home equity to capture investment opportunities that can yield financial benefits. The idea is to use a stable, low-interest home equity loan to invest at a higher yield. Like any investing, one should do thorough homework and research. All investing carries some…, Help with Education Costs, There are many stages of life. An education prepares young men and women to thrive in the real world. After all, a young adult with the proper education is much more likely to do well for themselves and become independent sooner. To help cover the costs of education, people use a home equity loan. For some, interest rates and loan amounts are attractive enough to use home equity loans for…, The Unexpected/Emergency Fund, As the old saying goes, "Life is what happens while you are busy making other plans." Sometimes unforeseen circumstances and challenges pop up in life. When they do, it's nice to have a source of cash to tap into to help. This is why some people use home equity loans or lines of credit for emergency funds. The key to making this work is using the loan or line of credit for real emergencies and…, Large Purchases Using Home's Equity, People have also used home equity loans or lines of credit for large purchases. While some might want to limit use of home equity loans to emergencies or major life events, others may want to take advantage of the longer terms and lower interest rates offered by home equity loans to make larger purchases more affordable., Pay Off Other Debt, For those who are trying to handle debt, using a home equity loan might be an option. Some people are looking at late fees, high-interest debt, medical bills, or other issues. When this is the case, a home equity loan might be an option that provides lower interest rates to wipe out other debt and avoid late payments. While this may seem attractive to those looking to solve debt issues, this is…
- Many people are interested in getting the cash they need by tapping into their home's equity. Questions that we're often asked relate to a person's credit. The questions sound something like this: How important is my credit for getting a home equity loan ? How does my credit score affect a home equity loan? Can I get a home equity loan with bad credit? These are important questions to ask. Like…, Here are the basics when it comes to credit and your home equity loan:, The better your credit, the more likely you will be approved for a loan. The better your credit, the more likely you will get a more attractive interest rate . This is also true for most loans and lines of credit. This means it's important to do the things that help raise your credit score. One of the most important factors is having a track record of consistently paying your bills and loans on…
- Generally speaking, when it comes to using the equity built up in their house, people understand that it's an option to tap into that equity to get cash they need. However, before going forward with a home equity loan it's good to understand how it works. So, let's take a look at the basics of the home equity loan and how it works. A home equity loan is when homeowners borrow against the equity…, Let's look at an example:, A man named Barry owns a house valued at $250,000. Barry still owes $200,000 on the mortgage. His equity would be $50,000. This number is used to help determine what your loan would look like. Other factors that are considered when determining the loan amount and terms are credit reports, payment history, and income. It's also important to remember that homeowners are allowed to borrow a certain…
- People who own homes sometimes need money for those things that life throws your way. The good news is that homeowners can tap into the equity of their home to get the money they need. There are two main ways to do this: a home equity loan or a home equity line of credit (HELOC) . Home equity loans and home equity lines of credit have some things in common. However, there are some differences you…, What Do Home Equity Loans and Lines of Credit have in Common?, Both loans and lines of credit are considered second mortgages . In addition, both the home equity loan and the line of credit are secured by your property. Generally speaking, both home equity loans and HELOCs have shorter terms - usually 5 to 15 years. First mortgages tend to be 15 or 30 year terms. Now that we understand what home equity loans and lines of credit have in common, let's see how…, How Are Home Equity Loans and Lines of Credit Different?, How Does a Home Equity Loan Work?, Of the two ways to use your home's equity, the home equity loan is more straight-forward. It's very similar to how a mortgage or other traditional loan works and typically there are no special features like interest only payments. The home equity loan is a loan for a set lump sum of money to be paid out over a determined time. This means there is a fixed interest rate, and the payments are the…, How Does a Home Equity Line of Credit Work?, The thing that sets a home equity line of credit apart from a home equity loan is its flexibility. It's a flexible option based on how the lines of credit are structured and how you can access your cash. Instead of receiving one lump sum, you have access to a reserved amount of money over a given period. You can take as little or as much as you need depending on your circumstances. For many, this…, A Better Understanding Makes For Better Decisions, Now that you understand the basics of home equity loans and lines of credits, you can make a more informed decision. Knowing how each works can help you decide what is better for your specific financial needs. If you want to know more about home equity loans or lines of credit, contact our lending experts at your local branch or at 800.242.2120. We're happy to help.
- Home ownership has benefits. , One of those benefits is the ability to use the equity you've built for other financial needs such as home improvements. A home equity loan can also be used for various financial needs such as repairs, debt consolidation, vacations, or college expenses. There is a specific difference between a home equity loan and a home equity line of credit, or HELOC . A HELOC is a line of revolving credit with…
