A home equity loan is a loan that is guaranteed by your home. Are you in urgent need for cash and want to get the same without selling off your home or property? Getting a home equity loan is a good way to do so.
Equity on your home is essentially the difference between the value of your home and the outstanding mortgage. Lot of finance companies today offer good deals on home equity loans, letting you borrow money based on the available equity on your home.
This type of loans product basically works on the idea that you use the amount you own within your property as collateral against a loan. You put it up as a guarantee to your lender that you can repay any loans. This allows you to free up the amount you already own within your property and use it as hard cash.
Most lenders will work out how much equity you have for you - but it's simple enough to do it yourself. All you need to do is to work out how much your property is currently worth and then subtract your mortgage from it. If you're not sure how much is currently outstanding on your mortgage, have a chat with your lender and they'll be able to help you out.
A home equity loan allows homeowners to access the equity in their primary residence without having to sell the property. Equity is the difference between what a home is worth and what is owed against it. Traditionally, home equity loans were called second and third mortgages.
You might have heard about using these types of financing products to meet your financial goals. Most home equity loans are simply second mortgages, structured either as a lump sum loan similar to a first mortgage, or as a line of credit.
Home equity loans are also referred to as "Equity Release Scheme". The money you get on a home equity loan can be used for a variety of purposes such as to fund home improvement, buy a new car, consolidate your debts or finance a travel plan.
Home equity loans are particularly useful for the elderly. Elderly people can release the equity on their property and use the money to supplement their pension. This additional amount can be used to pay for the cost of residential care if they need it.
Home equity loans allow the elderly to borrow money at relatively low interest rate and with a low monthly repayment, thus easing the financial burden considerably in the old age. Under certain schemes there is no need to make a repayment at all. Depending on the equity in the home, these lenders simply reclaim the loan and interest by selling their house when they pass away or move on.
If you're looking to borrow money this is probably one of the easiest and most cost-effective ways of doing it. Lenders like giving out home equity loans because they know that they'll get their money back whatever happens.
This all means that you can get the most preferential rates and deals in comparison to other loan products. Another big advantage is that this is a way of freeing up cash that is already technically yours. Without any of the hassle or costs associated with moving.
The cost of the loan will depend on many factors including your personal circumstances, the amount you wish to borrow and over what period you wish to repay back the loan.
In a typical home equity loan, the home is used as collateral against the loan, meaning that should you be unable to maintain the loan repayments, your home will be at risk.
You may freely reprint this article provided the author's biography remains intact:
About The Author
John Mussi is the founder of Direct Online Loans who help UK homeowners find the best available loans via the http://www.directonlineloans.co.uk website.
There are hundreds of mortgage companies in the Jacksonville real... Read More
Seldom in ones life do we get a chance to... Read More
Escrow is one of the last stages in the purchase... Read More
Persistence is the key working toward getting approved for a... Read More
Just as there are many types of mortgages and mortgage... Read More
Mortgage lenders have set up shop online, but they aren't... Read More
A remortgage is changing your mortgage without moving your home.... Read More
The housing market has exploded, with home prices rising beyond... Read More
When you have poor credit, your list of lenders that... Read More
Some people in the real estate industry have a terrible... Read More
Home loans may seem like a bad idea for people... Read More
Many Homeowners are not aware of all the options that... Read More
Have you heard about or been interested in finding out... Read More
You can maximize your savings by shopping for a lender... Read More
Having poor credit alone cannot hold you back from getting... Read More
In other words, the benefit of the loan must outlast... Read More
Maybe you've heard the expert advice that your debt to... Read More
Imagine this: you've found the perfect house, and feel lucky... Read More
A tracker mortgage 'tracks' the Bank of England base rate,... Read More
If you are considering buying a home, then you may... Read More
If you have seen all the advertisements regarding refinancing your... Read More
You're selling your home and are looking to relocate to... Read More
Sub prime lenders handle high risk mortgage loans that traditional... Read More
Getting home loans is possibly the biggest step in an... Read More
If finances had a copyright, we would have bought it... Read More
Real estate prices have been increasing steadily over the last... Read More
The booming real estate market has allowed many Americans to... Read More
1. Never discuss your household finances over the phone with... Read More
With so many lenders out there, it can be hard... Read More
A home equity loan is a loan that is guaranteed... Read More
W. Edwards Deming said "Marketing and innovation are the only... Read More
Refinancing your home is a major decision not to be... Read More
There are numerous reasons a person has bad credit. Late... Read More
A pension mortgage may seem lucrative at the first sight.... Read More
You may think that applying online for a mortgage is... Read More
Outlined below are some useful flexible mortgage tips. The most... Read More
If a mortgage could be paid off in five years... Read More
I don't know what the mortgage situation is around the... Read More
The prospect of mortgage debt elimination is something that many... Read More
Mortgage refinancing is when you take a mortgage of a... Read More
If you want a low interest, low payment mortgage refinance,... Read More
A commercial mortgage or commercial remortgage is a business loan... Read More
If you are a homeowner, you've probably received offers to... Read More
There are several reasons why you might be in the... Read More
Consumers interested in purchasing or refinancing a home will pay... Read More
Financing your new home loan online can save you time... Read More
I continue to see the same For Sale signs in... Read More
How does an ARM work.The borrowers interest rate is determined... Read More
Perhaps you're a homeowner in need of some quick cash.Maybe... Read More
When you begin your search for a new home loan,... Read More
During the last five years, home prices have increased nationwide.... Read More
Buying your first home will likely be the biggest and... Read More
Your goal is not only to find the best rates... Read More
If your mortgage company is threatening foreclosure, there are things... Read More
Let's start by taking a look at 7 key elements... Read More
Home equity loans are a popular way for homeowners to... Read More
Mortgage cycling is a system that relies on solid budgeting,... Read More
A fixed-rate mortgage is a mortgage on which the interest... Read More
Buying a home is probably the single largest investment most... Read More
Most people probably assume that obtaining a mortgage to purchase... Read More
Mortgage advice overwhelming you? Many people get advice from everyone... Read More
If you are a home owner who is having to... Read More
Do you know what it takes to qualify for mortgage... Read More
Looking for the best homeowner loans can be stressful, especially... Read More
If you're looking for the best home improvement loan for... Read More
Refinance home loan lenders are eager to lend money to... Read More
Mortgage Refinance |