Home equity and refinance

Home equity is the value of a home minus the mortgage debt and other encumbrances. Therefore, the longer a consumer has been making payments on a home, the greater the home equity accumulated.

Home equity may be the best way to establish a substantial credit line or loan. A home equity loan is a fixed amount payable over a period of years, typically 5 or 10 years. A home equity line of credit is an amount that the consumer may borrow against by drawing “checks” up to the amount of the approved credit line. This home equity line of credit may not have a definite pay off date. Home equity allows a consumer to make a substantial investment. However, depleting your home equity has its risks.

Things to consider when shopping for a home equity loan:

• How much money is available to borrow on a home equity loan or credit line? Depending on individual credit history, some lenders may allow the borrowing of up to 85% of the appraised value of a home.
• Know the interest rate and whether or not it is a fixed or variable rate. If it is a variable rate know the index used and history of the index.
• Obtain a list of all the fees that will be charged in addition to the interest. Insist on such a list.
• Have a plan to repay the loan. Lenders may require payment only on the interest until the account closes or they may have a minimum monthly payment. Each individual should create a plan of how they intend to repay the loan.
• By looking at these and other factors, consumers will be able to better determine if a home equity loan is right for their needs.
• Fill our small Home Equity application and you will have an answers on all these questions in a minutes

Comparison-shop. Complete our Home Equity application to see the rates being offered by different lenders. Make sure to check out at least three (3) lenders, compare their interest rates and fees.

Pay close attention to all fees. These fees may not be included in the annual percentage rate.

Negotiate. Make lenders compete for your business. Let them know that you are shopping around. Force them to make the best deal for you. After you have found the best deal, make sure that you read all the financial papers carefully and that you understand the terms. This will ensure that you won't be charged with fees that you weren’t expecting. If at closing, the loan isn’t what you had agreed upon, don’t sign. Negotiate the changes to the agreed upon terms, or leave.

Before going into any loan meeting, make sure that your credit report is accurate and up-to-date.

Remember! You have three (3) days to cancel your home equity loan after you sign the contracts. When the three (3) days are over, you are bound to the loan and everything attached.

Apply for Home Equity loan now!