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? With a home equity loan, a fixed or adjustable rate loan is secured by the equity in your home. As with your first mortgage, you can borrow a specific sum of money to be paid back monthly over a certain period of time. A home equity loan might also be referred to as a second mortgage.

Home Equity Loan Specifics

Getting your first mortgage is a similar routine to that of a home equity loan. Your closing costs (often 2-3 percent of the loan amount) are generally smaller and, although the rate of interest is larger on a home equity loan, the interest paid will be tax deductible.

In order to qualify for a second mortgage, you will need a reasonable credit score and you need to be able to verify your salary. A home appraisal will be necessary to determine the property's current market value. To check on your home equity/second mortgage loan choices, call us at 2817780805.

Have questions about your home equity? Call us at 2817780805. 1st Credential Mortgage Inc answers questions about home equity every day.