Better Home Equity – Teaching You the Loops

Home Equity Online Loans September 15, 2006

There are many people who have heard about home equity online loans, but most of them do not know the true meaning of home equity online loans. Home equity online loans are best for those who need an extra line of credit in their lives. Actually, there are several things that make home equity online loans such a great sell, for instance, the ease with which one can be gotten and the low interest rates.

For those who are curious about home equity online loans should know first the meaning of the term. Home equity online loans are lines of credit that people can get by putting their homes up as a security. They are not second mortgages, but they have similarities. One of the best examples of their similarities is that, if you do not make your monthly payments as scheduled, then you could lose you home to the lender. Almost all of home equity online loans are revolving which means that once you have paid some of the money back, you will be able to take it out again when needed, much more similar to a credit card.

Before choosing any type of loan, you should look at other options that maybe considered as right for your situation and your family. What is right for other people does not mean it’s also right for you. You should always remember that if you are looking at home equity online loans. To be able for you to know if you are making the right decision is to keep your options open.

Review your credit report and credit source. If you have excellent credit, then you may not even need to get home equity online loans. For the best part, you may qualify for unsecured loan, which will mean that you do not have to put your house on the line by serving it as collateral. This is great, since you will no longer be put in a position wherein you will face the possibility of losing your home if for any reason you can’t pay your bills. 

But you might still decide to consider home equity online loans, for the reason that they can have lower interest rates compared to other loans. The reason these rates are sometimes lower is because the loan is secured and the lender feels confident for that matter. It makes sense, doesn’t it? If you don’t have good credit, try to take some time to build it before you apply for any home equity online loans for, eventually this will get you better rates and terms on your loan.

Shop around for the best home equity online loans so that you will not settle on second best. You really must around if you are trying to choose the right home equity loan. You are looking at borrowing a lot of a lot of money and you have to know that you are getting good interest rate. Not all lenders offer the same rates and once you start shopping you will find out big the differences are.

Home Equity Loans September 15, 2006

Do you have your own house? If so, your home is likely to be your asset if you are planning to apply for home equity loans. Home equity loans allow you to borrow money and your home will serve as collateral. Those people who own homes would want to borrow a comparatively large amount of money or those who do not have good credit usually find home equity loan to be the best option.

Lenders, however, may be more broadminded since they view home equity loans as fairly safe. It would be very impossible for you to just run away with your house or hide it if you fail to pay on your loan, so the lenders have a good chance of collecting (and they will!) the collateral- your hard-earned home. And to top it all up, you will surely make your payments a priority if your home is at risk.

Nevertheless, home equity loans have attractive advantages that may convince homeowners to take the big leap to borrow money, such as:

• Lenders typically have lower interest rates
• They are easier to qualify for even if you have bad credit
• Payments on home equity loans may be tax deductible
• Borrowers can have a chance of borrowing large amount of money with this kind of loan

Most of the borrowers use home equity loans for much more life’s greater expenses, since homes tend to have a lot of value to borrow against. Usually, borrowers are likely to apply this type of loan be used to remodel or renovate their house, payment for college education, finance the purchase of another house, and consolidate high interest debts.

But before using home equity loans for whatever purpose, you should be aware of the downsides of these loans. One of the most important things that you should always remember is that you can lose your home if you fail to meet the payment schedule required by the loan. Another downside is that scammers have found plenty of ways to deceive or cheat homeowners out of their home. Make sure that you know who you are doing business with and that the deal is legitimate.

If you want to find the best home equity loans wherein you can save thousands of dollars you have to:

o       Be patient to shop around by trying a variety of sources, like banks, brokers, and credit unions.

o       Manage your credit score and make certain that your credit reports are accurate

o       Ask your family and friends on who they can recommend

o       And, compare the offers being presented to those home equity loans found on websites and advertisements

Home equity loans may be the best source if you need a very big amount of money. But to make the deal work out in your best interest, think it over and over to be sure that it is the right deal in the first place. If you are in doubt, figure the things out very carefully before you put your home in jeopardy.

Home Equity Loans – Useful Application Tips September 15, 2006

Obtaining a home equity loan does not have to be a major ordeal. You can close the loan at your own leisure time, shopping around and researching different options available to you. To get the best deal, you should understand the process and everything that is involved. Never let any lenders put you under pressure and get you into something you don’t understand. Here are some of the home equity loans- useful application tips that might become handy under any circumstances.

Home Equity Loans -Useful application tips:

• The process of applying for home equity loans will vary depending on your lender, but you can choose to pre-approved or pre-qualified. The pre-qualification process allows you and the lender to review your current financial situation, and then the lender will determine the amount you can borrow. There is no obligation and you are not locked-up into anything. Pre-approval is a step further and is a more formal process. You will actually fill out an application and a credit check will be run. The lender will then issue you a letter summarizing the amount you can borrow. You can use this to speed up your loan once you are ready to close.
• Get your home appraised, because appraisal of your home is necessary. In obtaining home equity loan depends on how much your home is worth, and any improvements that you made since the purchase can increase its value. Find out at the beginning how much your home is worth and this will help give you an approximate amount if how much you can actually borrow.
• A home equity loan appears to be a simple way to get needed funds, but it’s important to remember that your home is at stake, which means you can lose your home. This is why it’s important to discuss the process with everyone involved to understand what this loan entails. Everyone should prepare themselves emotionally for whatever unexpected to come. Set up a budget for a few months before closing and set aside the extra monthly payment. In addition, consider any life changing event that may occur during the course of your loan like changing jobs or having a baby, for these may affect your ability to repay your loan.
• Make sure that you have all of the facts when it comes to choosing a lender, so that you can make a well-informed decision as to which one is the best for your particular situation.
• Normally, home equity loans are tax deductible. Make sure to keep all paperwork associated with your loan, including closing cost allocations. You may be able to deduct the interest and principal in some cases. Consult with your tax professional to find out how a home equity loan affects your tax situation.

These home equity loans- useful application tips may come in hand someday when time comes that you’ll need necessary funding for whatever important project you have in your head. I believe that homeowners will need home equity loans- useful application tips if they decided to apply for one.

Home Equity Loans Questions September 15, 2006

Maybe you have heard about home equity loans and you want to know a lot of things about it. Actually, home equity loans are very popular most especially to homeowners for only one reason and that is, they can borrow a lot of money from home equity loans.

But before you get exited of the “a lot of money” thing, I’m sure you have several home equity loans questions playing in your mind. The most frequently asked home equity loans questions are:

• What is a home equity loan?
• What is a home equity
• What is the difference between a home equity loan and a home equity line of credit?
• What can a home equity loan be used for?
• How much can I borrow?
• How quickly can I get a loan approved?

These are just some of the many home equity loans questions asked by many homeowners who have heard about home equity loans and I’ll give you the answers those questions as simple as possible.

A home equity loan, or second mortgage, allows you to borrow large amount of money against the equity you’ve built up in your home at very competitive interest rate. Home equity is the difference between your home’s appraised value (current market value) and the total amount you owe on your mortgage. If your home is worth $ 100, 000 and you owe, let’s say $ 40, 000, you have $ 60, 000 in home equity.

There are two types oh home equity loans, the home equity and the home equity line of credit. Both types let you tap into the value you’ve built up in your home, they have significant differences. Home equity loan is like a second mortgage wherein you get the money in lump sum and pay it off over an agreed term, which can be 5 to 30 years. Once you get the money, you can’t borrow any further, the total monthly payment is based on the total amount of the loan, and interest can be tax deductible.

Conversely, home equity line of credit allows you to borrow money as you need it and pay the interest on the outstanding amount. The monthly payment is based on the amount used and funds can be re-used as they’re paid off up to the credit limit. You can access credit line by using checks as many times as you like during the draw period up to your credit limit, and tax may also be deductible.

Home equity loans can be used for a lot of thing, more important things to be exact. Since your home is on the line here, you might want to spend the money in bigger things like college tuition, hospital bills, home renovations, consolidate debts, or any of life’s big expenses.

The whole process of loan application may take 10 to 14 days to approve. But even before it’s approved you can determine the possible amount you can borrow. The total amount you can borrow usually depends on the percentage set by lenders, your ability to repay, debts, and other financial obligation. For example,

Your home’s appraised value                          $ 100,000

Percentage                                                        x     80 %

Percentage of appraised value                                 = $ 80,000

Less the amount owed on mortgage             – $ 40, 000

Potential amount you can borrow                   $ 40, 000

Some of the home equity loans questions not included here, you can ask any home equity loans questions from any lenders and friends who have tried it. If you think home equity loans might be the answer to you financial need for now, shop around and negotiate as many lenders as you can to get the best deal.

Home Equity Loans in South Carolina September 15, 2006

Home equity loans are very useful if you need a relatively large amount of money to be used for some important things such as payment for college education, house renovations, or payments for hospital bills. Home equity loans are definitely not for day-to-day expenses. Since your house is on the line, you better use the money you borrowed on important things, which is very likely.

Home equity loans are currently one of the best ways to get more money without so much trouble. It only takes for anyone wishing to borrow money a house. Yes, a house, your house! For this reason, a lot of lenders are venturing into this business. And why not, there’s no reason for them not to, because they don’t have anything to be scared of. Whether a borrower makes his payment faithfully or not, this business will not lose- they are secured by the collateral which is your home. Always remember that the market value of a house is constantly rising and that shelter is one of our basic needs. There were always be people wanting to purchase a house and these lenders would be very happy to sell your house to them. It may sound like a nightmare, but this is the real score if you aren’t able to pay your dues on time.

This is why it is imperative that you choose the right company to make business with and make sure that your deal is legitimate to avoid the risk of losing your home. And if you want to save thousands of dollars from borrowing money, you should shop for lenders that have the lowest rate. In this connection, there are several financial services that offer home equity loans in South Carolina that you may want to check out; that is if your property is in South Carolina. The many lenders that offer various loans plan including home equity loans in South Carolina are offering low interest rates and other benefits to homeowners. Even if they claim to be the best financial group, it will still pay if you are very careful in studying every detail about the terms and conditions, especially if you are talking about your home.

At www.business.com, you will find some financial services providing home equity loans in South Carolina. There you can broaden your search, have different selection, and make comparisons as to what financing company is best for you. Do not limit your search for the financing companies to 2 or 3 only if you want to get the best deal. You have to shop around whether online or you may visit to their locations in order to discuss any home equity plans they can offer to you. Applications for home equity loans in South Carolina are also offered on online, for example, refinacesave.com and lendingtree.com.

Home Equity Loan Rate Comparison September 15, 2006

Do you know why home equity loan rate comparison is important? It is important to understand that you can get a better deal on a home equity lone through comparison and negotiation. A home equity loan is a product, like a car, that is negotiable. Lenders and brokers may offer different figures for the same home equity loan terms to different homeowners (and they really do), even if those homeowners have the same qualifications. Most likely, the reason for this difference in figure is that lenders and brokers are usually allowed to keep some or all of this difference as commission. Now, do you get how the idea of home equity loan rate comparison and negotiation can get you a better deal? I bet you do!

Actually, the difference between the lowest available amount for a loan product and any higher amount that the borrower agrees to pay is an overage. When overages take place, they are built into the quoted to homeowners. They can occur on both fixed and variable rate home equity loans and can be in the forms of points, fees, or the interest rates. The quoted amount of a home equity loan may include overages.

When you have received a loan offer, as the lender for the lowest interest rates, waive or reduce one or more fees, or lower points. Make sure that the lender is not agreeing to lower one fee while raising another or to lower the rate while raising the points. There is nothing to be lost in your part or the lender’s by asking lenders to give better terms than the original ones, which are obviously high but negotiable.

There is a heavy competition among the lenders in the home equity loan “department” and you need to take this as an advantage on your part to find lenders who are willing to offer you the best deal there is. Do home equity loan rate comparison shopping and negotiate as many lenders as you can find. Let the lenders know that you are shopping around for home equity loan rate to make sure that they offer you their best deal. At the very worst, home equity loan rate comparison shopping may give you three similar offers from three lenders, but always remember that there are many lenders who are offering home equity loans which could also mean that three is just a small number to count on. Shopping for home equity loan rate comparison should not be limited to a few lenders- shop as many as you can, and besides it’s free. This will somehow give you comfort in knowing that you were not being taken by one unscrupulous lender who is trying to take you and your home for a ride.

Home Equity Loans in Texas September 15, 2006

Home equity loans are financial products that allow a borrower to use the market value of a home as collateral for a loan. Loans that are secured by real estate are considered safer by lenders which results in lower interest rates compared to other types of loans. Equity is easily calculated by subtracting the amount owed on the mortgage from the home’s current value. For instance, the current value of your home is $ 200, 000 and the amount owed on mortgage is $ 50, 000, the homeowner has equity of $ 150, 000.

The home equity loans in Texas are computed using 80 % of the value of the borrower’s home as collateral. From the computation of equity above, we can now determine the potential amount in which a Texan homeowner can borrow.

The appraised value of your home                              $ 200, 000

Percentage                                                                         x 80 %

Percentage of appraised value                                             = $ 160, 000

Less the amount owed on mortgage                         – $   50, 000

Your potential credit                                                    $ 110, 000

The total mortgage debt, including the amount of any existing mortgages plus the projected equity lien can’t exceed 80 % of the home’s current value. Homeowners with 20 % or less equity in their homes are not legible for home equity loans. Texans voted to limit the loan amount to 80 % to help prevent overextension of credit and protect their economy during the times of economic slowdown.

Market competition and conditions determine the rates in general. The borrower’s own credit history will greatly affect the rate being offered. Home equity loans in Texas usually have lower interest rates compared to other types of consumer loans, such as loans secured merely by a borrower’s signature. The primary loan on a house most often has the lowest interest rates. To find for the best deal there is, it is best that you shop around to look for lenders with the lowest rate you can find.

Lenders can charge certain fees like closing costs in addition to the interest. On home equity loans in Texas, closing costs can’t exceed 3 % of the principal amount you borrowed. Prepaid interest, or known as points is not subject to the 3 % cap.

If you are considering home equity loans in Texas, that is if your property is in Texas, it is important that you take time to examine a loan agreement before even signing it. The interest rates and other costs may vary from place to place. It is wise to know the percentage, interest rate, and other costs that a state is offering to avoid misunderstanding. In short, you should familiarize how home equity loans in Texas work before making business with any lenders.

Home Equity Loan Calculator September 15, 2006

Have you been searching on the net for the best financing services that offer low interest rates and benefits? Do you hate it if you land on websites that do not have useful tools you definitely need for easier access? For example, you are searching for the best deal of home equity loans and you are brought to a certain website that does not include or feature a free online calculator for your computations on rates, monthly payments, and the like. Isn’t that irritating?

Online financial services that offer several different types of loan have useful tools such as calculators to help compute rates, the amount of which you are allowed to borrow, and the monthly amount you have to pay from the borrowed money. That is the importance of home equity loan calculator. Fortunately, most of the websites that I have visited that are offering home equity loans are providing calculator. Home equity loan calculator can greatly help their visitors in accessing their websites. This would mean faster computation and research.

Since, it is best for you to shop around for the best lenders that can give you the lowest interest without going from places and places, the online financial companies make this task becomes easier. In every lending websites, it is likely that you find a calculator for your instant use in the computation of any loan, including home equity loan- hence, sometimes referred as home equity loan calculator.

In a home equity loan calculator, you just have to fill out the boxes intended for the information required, such as the appraised value of your home, the amount owed on mortgage, the terms in which you wish to pay for your loan, and the like. If you supplied all the required fields with correct information, you will get the result a few seconds right after you click on the compute button.

But that’s not all! A home equity loan calculator can also be used to compute consolidate debt, the potential amount you can borrow, home value, and tax savings. The consolidate debt calculator, computes the advantages of using a home equity loan to consolidate debt. By consolidating your high-interest debt into one low payment, you’ll get rid of your debt and have more money in your pocket each month. To compute for the amount you can borrow, the home equity loan calculator will estimate how much you can borrow against the equity in your home by answering just a few simple questions, like where you will use the money, and filling out the boxes(as I’ve mentioned above). The home value calculator is used to get an instant estimate of your home’s current market value. Just answer a few questions and you will get the result as to how much your home is worth. And, the tax savings calculator is used to find out what tax advantages you can get from a home equity loan.

Those are the benefits of home equity loan calculator. If it is provided in all the websites offering home equity loan, the research, computation, and result will be found out easier and faster.

Home Equity Line of Credit September 15, 2006

Due to the continuous rising of market value of homes today, more and more lenders are offering home equity line of credit. By using the equity in your home, you may qualify for a considerable amount of credit which is available for use however and whenever you please at an interesting low interest rate. It sounds interesting, isn’t it? But, what does home equity line of credit really mean? If your home is at risk, you might want to know what it is and what you are going into before making a big decision in your life.

Home equity line of credit is actually the same to a credit card in which you have an upper spending limit against which you can draw as needed. But the difference is that it is secured by the equity in your home. In addition, under the tax law and depending on your specific situation, you may be allowed to deduct the interest because the debt is secured by your own home.

Since the home is likely to be your largest asset, many homeowners use their home equity line of credit in for major items such as home renovations or improvements, education, or medical bills and not for usual expenses like shopping, grocery, or dining.

With a home equity line of credit, you will be approved for a specific amount of credit, which is your credit limit or the maximum amount you may borrow. A lot of lenders set their credit limit on a home equity line of credit by taking a percentage, for example 80 %, of your home’s appraised value minus the balance to be paid on the existing mortgage. To compute:

Your home’s appraised value                                      $100, 000

Percentage                                                            x              75 %

Percentage of appraised value                                                $ 80, 000

Minus the balance owed on mortgage                        $ 40, 000

                                                                            ———————–

Your potential credit                                                   $ 40, 000

To determine your actual credit limit, the lender will also consider your ability to repay, by looking at your income, debts, and other financial obligations as well as your credit history.

A home equity line of credit set a fixed period of time at some point in which you can borrow money, for instance 10 years. At the end of the grace period set by the lenders, you may be allowed to the credit line. If your plan does not allow renewals, you can’t borrow additional money as soon as the period has ended.

Once approved for a home equity line of credit, it’s likely that you will be able to borrow up to your credit limit whenever you want it. Usually, you will use special checks to draw on your line. In some other plans, you may use a credit card or other ways to draw on the line. There maybe limitations in how to use the line, like you may require to borrow a minimum amount each time you draw the line one (let’s say, $ 300) and keep a minimum amount outstanding. Some plans may also require you to have an initial advance once the line is set up.

If you are considering applying for a home equity line of credit, look for the plan that best meets your specific needs. Make sure to read carefully the credit agreement and look into the terms and conditions of various plans, including the annual percentage rate (APR) and the cost of establishing the plan. The APR for home equity line of credit is based on the interest rate alone and will not reflect the closing costs and other charges and fees. For these reasons, make sure to compare all the costs, as well as the APRs, among the lenders.

Fixed Rate Home Equity Loan September 15, 2006

Do you have something in mind that needs a considerable amount of money, like college education fees, major purchase, or home improvements? These kinds of expenses really need a large of money and the only thing you can do is use the equity in your home to borrow the amount you needed. Your home not only provides you shelter, but also help you in times of financial crisis.

Home equity loan is the most attractive tool in obtaining the amount you need. A fixed rate home equity loan is one of the types of home equity loans that allow you to get the full amount at the start of the loan and pay it down in equal payments for the term you selected. The good thing about this fixed rate home equity loan is that the monthly payment amount remains the same all throughout the term of the loan.

The fixed rate home equity loan has many different period lengths that it maybe required for. You may get a range of 5 to 30 years of loan terms. The shorter the term, the more savings you make. It is because, when you apply for a fixed rate home equity loan, the longer the term the bigger the interest rate becomes and the rate at the start of the loan will remain the same at the end of the term, where as in variable rate home equity loan, the rate may change depending on the PRIME RATE. If the PRIME RATE decreases, the rate of the variable rate equity loan also decreases.

Fixed rate home equity loan is best for homeowners who needed the money for one time use only. The advantages of fixed rate home equity loan is that the is tax deductible up to $ 100, 000, the interest rate are fixed, and you can borrow up to 125 % of you home’s value. This may sound so tempting, the large amount in which you can borrow, but don’t forget that your home is at stake.

If your purpose of applying for fixed rate home equity loan is to spend the money in something very important, then borrow only the amount that you need. That way, you will not need to be tied to this loan for long time and that there’s no chance that you will face the loss of your home.

The downside of fixed home equity loan can be: interest rates are usually higher than home equity line of credit, fixed end loan – means you can’t keep borrowing as needed, harder to qualify.

Whatever is in your mind that needs a great amount of money and you see that fixed rate home equity loan can be the best option, you might want to rethink again before making the final decision. Each type of home equity loans has advantages and disadvantages to help you weigh and decide what to choose. Study them carefully and don’t forget to shop around for lenders that offer the lowest interest rate.