What is a Home Equity Loan?

Do you need to tap into your home's equity to pay for a home remodeling project or to pay off a credit card? In a home equity loan, a fixed or adjustable rate loan is secured by the equity in your home. You borrow a sum to be paid back monthly over a set time frame, similar to original mortgage agreement. The terms "home equity loan" and "second mortgage" can be used interchangeably.

Getting the Loan

You will be accustomed to the process as it is a lot like the process toward your existing mortgage. Some distinctions are though, that the interest rate with a home equity loan is usually more (with tax-deductible interest) with smaller closing costs.

In order to qualify for a second mortgage, you will need a positive credit score and you need to be able to document your salary. To assess your home's current value, your lending institution will require a home appraisal. To explore your home equity choices, contact us at 208-941-3337.