What You Must Know About Home Equity Loans
by Jonah Brody
All your financial needs of starting a business or for wedding
can be looked by your home. Your home is not only a place where
you reside but can also be used for getting huge finance to
fulfill your dreams. Home equity loans are loans that are granted
on equity of the home.
“No-equity home equity loans” offer credit to those who might not
qualify for traditional credit. These quasi-secured loans have
rates 2% to 6% higher than traditional home equity loans. Fees
are also higher with these types of loans. It’s important that
you compare interest rates and closing costs from multiple
lenders. Pay particular attention to the fees, points, and
penalty fees. These often add thousands to the cost of the loan.
The various purposes for which home equity loans can be availed
are for debt consolidation, home repairs and improvements,
medical bills etc. The loan amount that can be availed under a
home equity loans depend upon the borrower’s repayment ability,
credit history, income status etc. The interest rate charged
under home equity loans is low and the repayment tenure for home
equity loans is up to 25 years. Since the repayment tenure is
large the loan amount can be repaid in small easy monthly
installments.
Home equity loans are granted in two ways fixed rate loans and
adjustable interest rate loans. In fixed rate loans the borrower
gets the whole loan amount needed in one go. The loan amount
applied for is obtained as lump sum whereas in adjustable rate
loans you are given a line of credit and can avail loan up to
that credit limit.
Home equity loans can be availed by borrowers with bad credit
history also. Any credit score below 600 is considered as bad
credit by lenders. The various reasons for bad credit history are
CCJs, IVAs, bankruptcy, arrears etc. Bad credit borrowers can
avail home equity loans at flexible terms of repayment and
comparatively interest rates.
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New Unique Article!
Title: What You Must Know About Home Equity Loans
Author: Jonah Brody
Keywords: home equity loans,home equity loan,loans,loan,finance,financial aid,mortgage refinance
Word Count: 322
Category: Finance:Loans
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Originally posted 2008-07-09 03:31:44.
