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What is a home equity loan what does it do?

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2009-03-13 16:18:54
2009-03-13 16:18:54

== A home equity loan is a type of loan in which the borrower uses the equity in their home as collateral. Home equity loans are based on the amount of equity you have built up in your home. (Home equity is the difference between the current value of a home and the amount still owed on the mortgage. As the principal of the mortgage amount decreases as a result of monthly mortgage payments, the home equity increases) You can borrow your loan as a traditional home equity loan (second mortgage) or a home equity line of credit (HELOC), which functions in a similar manner as a credit card. These loans are sometimes useful to help finance major home repairs, medical bills or college education. Which type of loan you choose is up to you and your specific financial needs. Both loan types are primarily low interest loans and, for most home equity loans, the interest you pay is tax deductible. However, it is important to know that when you take out a home equity loan, it means the lender can reposes your home if you default on your payments. So it's crucial that you maintain your loan payments. A home equity loan is a great financial resource, but if you don't pay it back, it could end up costing you your home.

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Related Questions

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A home equity loan is a type of loan in which the borrower uses the equity in their home as collateral. There is no restriction on how we can use the money from Home Equity Loan.

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If you have equity, you can get an equity loan

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A home equity loan is a loan that homeowners can get based on the equity that they have in their homes. This amount is based on the value of the house and how much they have left to pay on the home loan.

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Yes. Once a home equity loan, always a home equity loan; but there are certain programs that give breaks in rate to previous home equity acquisitioners.

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As soon as you have equity to borrow against. If you put a considerable down payment on a home you could get a home equity loan the next day. If you put 0 down than it will be several years before you have enough equity to get a home equity loan.

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If one has a home equity loan, payments must be made on the loan. Usually a home equity loan is taken out for situations such as major home improvements, or financing a college education.

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There appears to be no such thing as 'no cost home equity loans'. However a home equity loan is a type of loan when the customer uses the equity in their home as collateral. Information about these can be found on Wikipedia and Investopedia.

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An equity fixed home loan is a home equity loan with a fixed interest rate. These are used to repair a roof or fix a septic system. The homeowner takes this loan out in addition to the first mortgage and the equity fixed home loan is often referred to as the second mortgage.

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You can get a home equity loan with no mortgage but the process is a lot longer than the normal loan process. If you are interested in getting a home equity loan, please visit http://austinhomemortgageloan.com, we will be happy to assist you!

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An equity reserve is a share of the equity in a home that is reserved in protection of the loan outweighing the value of the home. In a traditional loan, the loan proceeds have a safe ratio compared to the estimated value of the home.

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An FHA home equity loan differs from a traditional equity loan in that it allows homeowners with bad credit to refinance their mortgage, and can be practical for people wanting to purchase a new home or repair their existing one.

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A person with bad credit can still apply and get a home loan by using the equity in their home as collateral. The more equity in the home the better the chances of being approved for the loan.

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A home equity loan is a loan that uses ones equity for money. Home equity loans have fixed intrest rates that assure consistent payments within a certain payment period.

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A home equity loan is a loan to be used to make repairs on a home. It is a loan that can be taken against a mortgage to fix a problem or make upgrades to a home.

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To apply for an equity loan you have to contact a mortgage or home equity lender and see what kind of equity your home has. If your property value has declined it is possible that you could have negative equity.

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No. A home equity loan, also known as a second mortgage, uses your home as security. If the loan is not paid back, the lender may go after your home.

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Yes, if you have enough equity in one home and want to use it to buy another. Otherwise, no. You cannot use a home equity loan to purchase a home since you have no equity that has accrued.

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A fixed home equity loan is a type of loan where the borrow uses the equity in their home as collateral. Various companies sell this type of loan like Bank of America and Citizens Bank.

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A home equity loan can be taken out any local bank as well as any business that specializes in just giving out home equity loans. Loan officers specialize in this.

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The average interest rates on a home equity loan depends on which home equity loan in particular. For example, the $30 HELOC is averaged at an interest rate of 5%.

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yes you can acquire a secure loan using your home. you can apply for a home equity loan or a home equity line of credit.

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One can find quotes for a Home Equity Loan through the site of the Bank of America. A home equity loan or line of credit can be a smart way to make home repairs.

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A home equity loan is a type of loan in which the borrower uses the equity in their home as collateral. Home equity loans are based on the amount of equity you have built up in your home. (Home equity is the difference between the current value of a home and the amount still owed on the mortgage. As the principal of the mortgage amount decreases as a result of monthly mortgage payments, the home equity increases) You can borrow your loan as a traditional home equity loan (second mortgage) or a home equity line of credit (HELOC), which functions in a similar manner as a credit card. These loans are sometimes useful to help finance major home repairs, medical bills or college education.

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The typical qualifications to take out a home equity loan are, you must have sufficient equity or collateral in your property, this is the difference in what your mortgage balance and home value's is.


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