Your Equity Is Your Security
Your home’s equity is the basis for your home equity. You can choose to access it with a variety of loan terms. Refinancing with a cash out will lock in long term rates. A second mortgage pulls out part or all of your equity while keeping your original mortgage intact. This is nice if you have a low interest home loan. Finally, you can create a line of credit based on your equity. It acts much like a low interest credit card.
While loan terms affect your rates, so will your property’s value. Using all of your equity will bump up your rates. Don’t forget to factor in your home’s appreciation when considering your property’s value.
The PMI Factor
Private mortgage insurance may be required with some lenders, especially if you have a prime loan. If you have less than 20% equity in the home, then expect to pay premiums. But sub prime lenders don’t require insurance. And in some cases, if you use a separate lender for your second mortgage, you won’t have to get insurance either.
Interest Is Tax Deductible – Sometimes
Interest from a home equity loan is tax deductible in many cases, unlike other forms of credit. There are caps on your income and the property value. For example, you can’t write off interest for a loan that exceeds your property’s value. There are also limitations on what the loan can be used for in some cases. Before using this deduction, be sure to read the IRS regulations.
Home Equity Loan Rates Vary Between Lenders
As with every other type of credit, rates will vary between lenders. Each lender will rate your application differently. They will also have different procedures for determining rates.
To get the best deal, you have to rely on loan quotes to make your decision. By providing just the most basic information, you can get a general idea of closing costs and rates. Only if you are serious about a lender should you allow them to access your credit report.
Home equity loans can also be consolidated into one mortgage in the future. Make sure you don’t have any early payment fees that would make this decision needlessly expensive.
By: Carrie Reeder
Friday, January 30, 2009
100% Home Equity Loan Financing – Online Home Equity Loans
100% home equity loan financing will give you access to all of your home’s value. So you can finance home repairs, a college education, or debt consolidation at low financing rates. And by searching online for your lender, you can find better deals on interest rates and closing costs.
Finding 100% Home Equity Financing Online
When planning to cash out your home equity, research several lending companies before settling on one. Online, your search is much faster with easy access to quotes and customer service representatives. In a matter of an hour, you can have dozens of loan estimates waiting for your review.
Home equity loans can have a lot more hidden fees than first mortgages. So it is important to compare annual costs and miscellaneous fees. The APR will give you the total cost of the loan, including closing costs. Fees for minimum balances, refinancing, and maintenance are in addition to the APR.
Why Online Lenders Offer Better Deals
Online lending companies, which often include your neighborhood banks, offer better deals to remain competitive. Online loans are also cheaper since overhead costs are reduced when you complete your application online. These savings are pasted onto you, often in the form of a discount.
Online mortgage brokers work out special deals with mortgage companies. They are also a good starting point for your home equity loan search. Most brokers will give you three or more loan offers to compare.
In addition to lower rates, online loans are processed faster than going to a neighborhood banking office. By entering your application over a secure connection, your information is processed immediately through databases.
In most cases, by the next business day you will receive a call informing you of the status of your loan. A final loan contract will soon follow in the mail for your approval. You can have your money in your hands in less than two weeks.
Take some time to really research lenders before applying for a home equity loan. Know what terms and conditions are most favorable for you. Find the loan that gives you both low rates and fees.
By: Carrie Reeder
Finding 100% Home Equity Financing Online
When planning to cash out your home equity, research several lending companies before settling on one. Online, your search is much faster with easy access to quotes and customer service representatives. In a matter of an hour, you can have dozens of loan estimates waiting for your review.
Home equity loans can have a lot more hidden fees than first mortgages. So it is important to compare annual costs and miscellaneous fees. The APR will give you the total cost of the loan, including closing costs. Fees for minimum balances, refinancing, and maintenance are in addition to the APR.
Why Online Lenders Offer Better Deals
Online lending companies, which often include your neighborhood banks, offer better deals to remain competitive. Online loans are also cheaper since overhead costs are reduced when you complete your application online. These savings are pasted onto you, often in the form of a discount.
Online mortgage brokers work out special deals with mortgage companies. They are also a good starting point for your home equity loan search. Most brokers will give you three or more loan offers to compare.
In addition to lower rates, online loans are processed faster than going to a neighborhood banking office. By entering your application over a secure connection, your information is processed immediately through databases.
In most cases, by the next business day you will receive a call informing you of the status of your loan. A final loan contract will soon follow in the mail for your approval. You can have your money in your hands in less than two weeks.
Take some time to really research lenders before applying for a home equity loan. Know what terms and conditions are most favorable for you. Find the loan that gives you both low rates and fees.
By: Carrie Reeder
Home Equity Loans vs Home Equity Line Of Credit - Which Option Should You Choose?
Tapping into your home equity loans qualifies you for low rates with the potential benefit of tax write offs. Lenders have developed a number of financing solutions for you, each with their own pros and cons. Home equity loans provide low rates with some closing costs. On the other hand, a home equity line of credit waives closing costs and application fees for flexible lending amounts at slightly higher rates.
Benefits Of A Home Equity Loan
For those wanting to borrow a large amount for several years, a home equity loan provides the cheapest financing. By paying closing costs, you can lock in a low fixed or adjustable rate. You also can select terms that help you get you a reasonable monthly payment.
Home equity loans usually don’t have any limit balances, early payment, or annual fees. Structured like a regular mortgages, interest is primarily paid at the beginning of the loan period.
Benefits Of A Home Equity Line Of Credit
With a home equity line of credit you can borrow amounts when you need to with an issued credit card. With a predetermined credit limit, you have flexibility of when you can draw on funds. So you can pay off the balance one month, and then borrow a thousand the next.
Interest is only paid on the amount you borrow. Usually, the minimum payment is only the interest charged for that month. Most lenders also offer the option of converting your line of credit into a second mortgage when you are ready to make regular payments.
A line of credit doesn’t usually have any application fees. But there may be fees for carry a minimum balance or closing the account early.
Choosing The Right Equity Financing
Home equity loans are designed for large lump sum payments, used to pay off credit card debt or pay for a remodel project. Terms extend for several years to make the loan payments manageable.
Home equity line of credit is best for short term financing. Interest payments can be kept to a minimum by paying off balances early. Opening a line of credit also gives you the option of available credit without having to pay large applications fees.
No matter which type of financing you settle on, make sure you compare several lenders to get the best deal on rates and fees.
By: Carrie Reeder
Benefits Of A Home Equity Loan
For those wanting to borrow a large amount for several years, a home equity loan provides the cheapest financing. By paying closing costs, you can lock in a low fixed or adjustable rate. You also can select terms that help you get you a reasonable monthly payment.
Home equity loans usually don’t have any limit balances, early payment, or annual fees. Structured like a regular mortgages, interest is primarily paid at the beginning of the loan period.
Benefits Of A Home Equity Line Of Credit
With a home equity line of credit you can borrow amounts when you need to with an issued credit card. With a predetermined credit limit, you have flexibility of when you can draw on funds. So you can pay off the balance one month, and then borrow a thousand the next.
Interest is only paid on the amount you borrow. Usually, the minimum payment is only the interest charged for that month. Most lenders also offer the option of converting your line of credit into a second mortgage when you are ready to make regular payments.
A line of credit doesn’t usually have any application fees. But there may be fees for carry a minimum balance or closing the account early.
Choosing The Right Equity Financing
Home equity loans are designed for large lump sum payments, used to pay off credit card debt or pay for a remodel project. Terms extend for several years to make the loan payments manageable.
Home equity line of credit is best for short term financing. Interest payments can be kept to a minimum by paying off balances early. Opening a line of credit also gives you the option of available credit without having to pay large applications fees.
No matter which type of financing you settle on, make sure you compare several lenders to get the best deal on rates and fees.
By: Carrie Reeder
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