Home Equity Loan
There can be many benefits to using the equity in your home to borrow money, some of which may include:
- Potential tax benefits: Home equity and mortgage interest payments are often tax-deductible. Consult your tax advisor whether this will be the case for your loan, and for other information.
- Lower monthly payments: Interest rates on home equity financing are typically lower than on credit cards or other personal loans, which could mean lower monthly payments for you.
Yes. Closing fees on a home equity loan are similar to standard mortgage fees (3% to 5%).
You will also have to pay an appraisal fee to determine the current value of the home. This valuation will determine the amount you can borrow.
Getting a home equity loan is much like getting a first mortgage; you need to be approved based on the amount of equity in your home and your credit-worthiness. Our loan officers will be happy to analyze your case and give you the best advice.
Terms vary, but you can borrow up to 80 percent of your home’s current equity (or current market value of your home minus the principal amount owed on your first mortgage, plus any other liens). A current appraisal is required to determine the amount of equity you have in your home, and in turn, how much you can borrow.
Also known as second trust or second mortgage, is a loan that uses the equity you have in your home as collateral. The entire loan amount is given to you in a lump sum and you make fixed monthly payments, just like your regular mortgage.