Home Equity Loans
What is a home equity loan? A home equity loan is a
loan that allows someone who owns a house to borrow money by using their
equity or the value of their home. For a home equity loan your
own home will become the payment if you don't pay back the money you
borrowed. A home equity loan can be either a changeable mortgage or a
fixed mortgage and can be taken as a giant
sum or as payment over time. A home equity loan usually is tax
deductible when it is used properly.
Why is it important?
A home equity loan is important
because it enables you to recieve money. Your home equity is literally an
excuse to get a loan. Large payments like medical bills or a college tuition are common reasons
to apply for a home equity loan. Purchasing another home is the most common reason, as the name states. There are many possibilities.
Why should I get a home equity loan?
The Upside
A home equity loan is good because it is tax deductible. Also, you
may be able to borrow up to 125% of your home's equity depending on your
credit rating. It is also good because if you have spent too much on a credit card and you can't pay it back right away, you may be paying a high
interest rate; so you could get a home equity loan to get a lower
interest rate and lower payments.
The Downside
It may be bad though for other reasons. First of all, you usually have to pay a fee
to get the home equity loan. With home values going down, the bank may not be willing to give out a home equity loan. Also, you may have to lose your home if
you don't pay off the debts.
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Pacific Northwest Mortgage Corporation •
1899 Concourse Drive • San Jose • CA • 95131
Tel: (408) 943-3165 • www.KidLenders.com
Fair housing lender and sales. Women and minorities encouraged to apply.
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