What is Equity?

At Today's Rates: Home Equity Loan is a Smarter Deal Than a Cash Out Refinance

You could have cash hidden in your home and not even realize it. We’re not talking about a hidden stash of treasure – we’re talking about equity.

What is equity? Equity is the amount of your home that you actually own. If you’ve been making mortgage payments consistently or have paid off your mortgage completely, chances are you have a significant amount of equity in your home. The great thing is that, through a Home Equity Loan, you can tap in to that equity to get access to funds that would otherwise be wrapped up in your property.

Smarter than a Refinance

You may have been tempted to get a Cash Out Refinance, but this type of second mortgage can have a term of 15 or even 30 years. That means you’ll most likely be making payments for longer than if you get a Home Equity Loan. Furthermore, according to CoreLogic almost all homeowners with mortgage hold note rates which are lower than the currently available rates. That means if you want to do a traditional cash-out refinance to access your equity, you will lose the lower rate your mortgage and will have to pay a new, probably higher rate on the entire new larger balance. Why refinance your low rate first mortgage when you could get a Home Equity Loan and keep that low rate? If you want a low cost, easy, cash-out loan, get a Home Equity Loan.

Have Fun with the Funds, or Tackle that Debt

With the funds from a Home Equity Loan, you’re not limited like you would be with other personal or business loans. You can use your funds to pay for a college education, home renovation, wedding, vacation, or more! You can even use Home Equity Loans to consolidate debt, which makes paying bills easier and can reduce the amount you pay on a monthly basis.

You can also choose the best way to receive your funds. With a traditional Home Equity Loan, you receive a lump sum that you can then use as you see fit. You can also choose to get a Home Equity Line of Credit. With this option, borrowers have a defined amount that they can take out of their equity, and they only have to pay back whatever they actually borrow. If you’re not sure how much you’ll actually need but want to have funds available, a Home Equity Line of Credit may be right for you.

Home Equity Loans Vs. Other Loans

How exactly do Home Equity Loans stack up when compared to other loans? Here are just a few of the benefits:

Funds for What you Want – You can use the funds from a Home Equity Loan for almost anything.

Easier to Qualify – Home Equity Loans are often easier to qualify for than other loans, especially if you have poor credit.

Funding Options – Get either a lump sum or a line of credit through a Home Equity Loan!

Low Rates – Home Equity Loans often have lower rates than other types of loans or credit cards.

More Funds – Borrowers can often receive more from a Home Equity Loan than they could get from a personal loan. This is great if you have a big expense you need to pay for, or you simply want access to more funds.

Tax Deductible

In some instances, the interest from a Home Equity Loan can be tax deductible. Speak to your tax advisor to learn more.

Check Out these Great Rates

It’s a great time to get a Home Equity Loan! You can check out current rates here and compare offers in minutes. The process is easy, and closing times are fast. See if you qualify today!