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Home Equity
Consolidate Your Debts With Home Equity LoansTip! The home equity line of credit, or HELOC, is like a bank account where you continue to write checks sponsored by the equity of your home. A HELOC does not have a fixed period of time wherein it will be paid off, because you can continue to borrow against it, just like to a credit card. Your home is your biggest asset. It does not just provide you shelter; it also comes to your aid when you are in financial distress. The equity of your home, built over the years, can be used to obtain loans by acting as the collateral. You can find two types of home equity debt, namely in the form of home equity loans and also in the form of home equity lines of credit otherwise known as HELOCs. Both of them are described as second mortgages, because just like the primary mortgage, the equity loan is also secured by your property. But unlike the first mortgage, the equity debt is repaid over a shorter span of time. The first mortgage is usually repaid over a span of 30 years, whereas the equity loan is usually paid within fifteen years. However, there are exceptions and the repayment period may be as short as 5 years and as long as 30 years. The growing popularity of home equity loan generally coincides with the recent surge in property value and relatively lower rate of interest. Thus more and more homeowners are turning to home equity loans for managing their personal debts. Other advantages of the home equity loan also include lower interest rate and tax deductions, making this mode of debt even more popular.
So far as the equity rate of interest is concerned, it is slightly higher than the first mortgage, but considerably lower than credit card loans or other consumer loan interests. Because your property is used as the collateral in equity loans, lenders consider them as secure as the first mortgage.
Tip! Reverse Mortgage - Retirees remaining in their homes can still tap their home equity as a source of retirement income. An entire industry has grown up around the 'reverse mortgage' concept which allows seniors over 62 to tap into their home's value without making any repayments during their lifetime. The tax deduction feature may be the biggest reason behind the huge popularity of home equity loans. Mortgage debt comes with attractive tax savings compared to lets say consumer loans, thus it is highly cost effective to consolidate your other debts with this loan and enjoy lower interest rate plus tax deduction benefits at the same time. With these benefits, namely considerably low rates for equity debt and tax deduction on the interest payments, it is no wonder that a number of homeowners are utilizing the equity of their homes to meet further expenses and debts. True, it is a mortgage on your precious home, but if you are able to pay back the entire amount within a short span of time and you have stable income, home equity loan is a good option for much needed credit.
Home Equity News:
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Home equity loans drying up for some - Personal finance- msnbc.com
Some homeowners are finding that even with great credit and 20 percent or more home equity, getting a line of credit on that equity can be difficult or impossible.
Equity in Americans? homes falls to historic low - Mortgage Mess ...
The equity Americans have in their most important asset ? their homes ? has dropped to its lowest level since the end of World War II.
Use of home equity hits a four-year low - Real estate- msnbc.com
The amount of money Americans pulled out of their homes is at a four-year low as homeowners battle falling home values and stricter standards among lenders, Freddie Mac said ...
Morgan Stanley to freeze home-equity lines - Mortgage Mess- msnbc.com
Morgan Stanley told thousands of clients this week that they will not be allowed to withdraw money on their home-equity credit lines, according to a news report.
Late payments for home equity loans rise - Real estate- msnbc.com
Late payments on home equity loans climbed to a 1½-year high in the opening quarter of this year, while delinquencies on credit card bills fell, painting a mixed picture of how ...
BofA tackling debt worries by cutting home-equity lines - Top Stories ...
Bank of America Corp. is tightening up its home-equity lending business, turning down applications and turning off credit lines in struggling housing markets.
Late payments rise on home-equity loans - Stocks & economy- msnbc.com
Late payments on certain auto and home equity loans climbed in the final quarter of last year, while delinquencies on credit card bills largely held steady, suggesting some U.S ...
Should I get a home equity credit line? - Answer desk- msnbc.com
Free money In this week's video Answer Desk, msnbc.com's John W. Schoen has some advice on how to avoid giving the government more of your money than you need to.
How to tell if now is the time to refinance - Personal finance- msnbc ...
You have at least 10 percent equity in your home and aren?t FHA-eligible. To get good rates, you?ll need to have equity in the home. In most markets, 10 percent equity is a ...
Morgan Stanley to freeze home-equity lines - Today Technology & Money ...
Morgan Stanley told thousands of clients this week that they will not be allowed to withdraw money on their home-equity credit lines, according to a news report. ... Morgan Stanley ...
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