What is a Home Equity Loan?

Do you want to tap into your home's equity to pay for a home remodeling project or to pay off a credit card? A home equity loan is a fixed or adjustable-rate loan that uses your home equity as collateral. As with your first mortgage, you'll borrow a specific amount to be paid back monthly over a certain period of time. A home equity loan also can be called a second mortgage.

Home Equity Loan Specifics

Getting your current mortgage is a similar routine to that of a home equity loan. The closing costs (usually 2-3 percent of the loan amount) are typically lower and, although your interest rate is more on a home equity loan, the interest can be tax deductible.

You'll have to provide income documentation and have good credit to qualify for a home equity loan. A home appraisal is needed to determine the home's market value. To check on your home equity loan options, contact us at 2146635355.

Have questions about your home equity? Call us at 2146635355. Debbie Oliver NMLS License #248252, America's First Choice Mortgage, NMLS License #279234 answers questions about home equity every day.