Home Equity Loan

Mortgage loans are used as a way for consumers to ask for a loan using your home as collateral. The equity loans can have a credit line or a standard loan and can have either fixed or adjustable rates. This website will provide valuable information on home equity loans, how they behave, and what should be considered.

1. Loans secured by mortgage - Summary

2. Why get a home equity loan?

3. Vs. Line of Credit. A lump sum

4. Interests

5. Your credit report

6. Shops all over & answer questions

7. The Federal Truth in Lending Act

8. Mobile homes

9. Things to consider

1. Loans secured by mortgage - Summary

A home equity loan is that use of collateral in their home country to obtain a loan based on the tax you have in your home. The levy is part of the house where he belongs and also the remaining amount of the value of the house still owed. Suppose you bought a house worth $ 100,000 and you paid $ 20,000 for the purchase of the house. Immediately, the $ 20,000 payment becomes the tax that you have in your home. 

Now, you have to take into account when trying to find out how much tax you have at home. Suppose you have paid at home for a few years and have managed to pay $ 12,000 in your home. Suppose further that in recent years have seen their home value and is currently valued at $ 115,000. The amount of tax is as follows: 

$ 115,000 (house value) minus the amount left on the loan ($ 80,000 - $ 12,000 = $ 68,000) = the sum of tax currently held in your home is now $ 47,000. On the one hand, can be satisfied that their $ 32,000 investment has become a whopping $ 47,000 so that a lender is willing to lend 100% of capital on the basis of a course evaluation, the secured loan for your home could be as much as $ 47,000. 

There are some lenders who do not pay under $ 50,000 for a loan guarantee with the house, so this is not the route to go if you want to borrow five or ten thousand dollars. In some cases, you can arrange a credit line that lets you borrow from the assessment of your home as you need, not a lump sum. This HELOC is an option for many people, and is an alternative to other forms of financing for home repairs and other expenses or other situations that would like to apply a personal loan. Apply for a loan guarantee to your house when you need to borrow much money though, you should make sure you can afford to make payments or put your home ownership in jeopardy.

2. Why get a home equity loan?

People take loans with collateral for a lot of different reasons. The ads you see on television mentioned several things you can do with a home loan guaranty, but the truth is that in most states anyway, you can do anything you want with the money. Your credit score, income and the amount of equity you have in your home determines whether and how much you can borrow, not what you do with the money. 

However, just because you can not mean you should. You are putting your home as collateral at least make sure you can repay the loan before accepting it. If you want to pay credit card costs are estimated at 14% interest and you manage to get a loan with your home warranty 8%, then it might be a good idea if and only if you have the discipline not to use to the credit card again. If you do, you will pay your home loan and assessment. The use of a loan guarantee to your home to reduce debt is a viable option only if you remedy the situation that caused the initial debt. Note also that by consolidating your debt with a loan guarantee to your home, your house will be at risk that did not exist before. 

If you want to make home improvements will increase the value of your home and if you can afford to make payments, then it would be a good reason to take a loan guarantee to your home. By improving the assessment of your home you have a most likely increase and may even succeed long term. Again, you can make sure you can afford the payment because no matter how valuable is the house, if you lose. 

Sometimes people get a loan guarantee to your home because you have an emergency, such as medical bills or need medical treatment. You can not enjoy your home if you do not have good health so if this is something you need to do a loan guarantee with the house could be a viable option for you.

3. Vs. Line of Credit. A lump sum

Depending on your credit and your lender, you may be able to choose between a line of credit and a lump sum. A lump sum, of course, means you get the entire loan at once and in advance. You can have a 15, 20 or even 30 year loan based on loan terms with your home warranty. Like any other loan, you make payments every month. 

A credit line, however, is completely different. Interest rates are similar, hiring a credit line, you will not have to use the loan amount all at once. You will receive a checkbook or a credit card with which you can make "withdrawals" to this line of credit up to a certain amount. Still we may have time to return the money with an increasing amount if you choose. 

Usually has a small payment each month, you can go toward interest, and then have what is called a "balloon" payment where most loans must be at the end of the loan could be 15 or 20 years. This may sound very attractive but the big balloon payment coming in due time and if you can not pay you lose your home. 

A house of credit line or HELOC may be the preferred method of secured loan for the house in many different situations. Suppose you are having the HELOC because it needs expensive medical treatments but want to borrow only what is absolutely necessary for what you need or you are remodeling your home, but again only want to borrow as much as you. 

Any of these situations would be appropriate to organize a HELOC. Not for the maximum loan amount of the levy is more likely that you will be able to return the money soon, the credit line still available if needed. A HELOC is a useful option that lets you tap into your home without incurring the substantial debt burden.

4. Interests

Your credit will have much to do with the interest rate will be able to get for your home equity loan. Are generally based on the raw plus a certain number of points. There may be variable and fixed rates, not realizing if you take a loan guarantee to your home with a variable interest rate, it could get much more expensive than the first time was applied for the loan. 

You will want to carefully consider interest rates and make the best decision for your situation. You can have different offers from different lenders so that will be something to consider when making inquiries about the best prices. 

Do not let the desire to take when you are applying for a loan guarantee to your home or any other loan for that matter. Be sure to sign the documents on his way to pick up the kids to school. You want to read every word of that loan agreement and make sure you understand every single word including the provisions relating to interest rates. 

You want to know if you have a grace period and what will happen if you are late with payment. Does the contract specify under which conditions the loan goes into default state? Make sure you understand all terms of the loan before signing anything. If not, consult your attorney. Your home is too important to assume the terms of a transaction that is one way when the reality is very different. 

Consider the interest rate as you would anything else. One point or even half a point can make a difference when you're working with 20 years of payments.

5. Your credit report

Even before applying for a loan secured by your home, get a copy of your credit report from all 3 of the credit reporting agencies. You can obtain these forms online for free, the website has a phone number you can call or you can request to be sent. You are entitled to one free credit report each year from all 3 credit bureaus information: Experian, Equifax and TransUnion. Some states allow you to get 2 free credit report each year. Check with your state if you are unsure. 

If you have been for the last 6 months you got your credit report to get it back, you have to pay for it. They only cost about eight dollars for what it's worth. You want to get your credit report before applying for a loan against your home for several reasons. 

First of all, you want to ensure that information on your credit report is accurate. Must be carefully and if there is any discrepancy, write to the credit reporting agency and the original creditor. Also, if you are purchasing a car or anything else you want to ensure significant recently is in your credit report too. Some people think that credit reports are only composed of "bad credit" simply not true. A good credit, bills worth, also appears on the credit report, and it is important to include everything. 

Another reason why you want to get your own credit report does not affect their assessment of credit when you get it by itself, but every time a creditor runs your credit, your FICO score is reduced which is the score that the lender will consider when offered the interest rate and other conditions relating to the assessment of your home loan. By adopting your credit report, along with meetings with lenders, you can discover what you can offer your credit without running. 

If anything in your credit report that needs cleaning, take care of before applying for the loan because the long wait for your credit, you pay less interest on your loan. Any dispute to discuss these issues on your credit report and contact your creditors to improve your credit, if possible before applying for a loan against your home.

6. Shops all over & answer questions

It is surprising that some of the same people who will be around town for a good price of soap to wash clothes, do not think twice before accepting the first offer you hear when dealing with thousands and thousands of dollars. Realize that can and should shop around for a loan in the same way we shop and compare prices of other items. 

You can literally save thousands of dollars by doing your homework, shop around and ask questions. You should get at least 3 deals when shopping for a loan against your home. Since you have your credit report with which you should not take long to get an appointment to the extent the interest and loan terms. You must also have in the last 3 or 4 pay stubs and your last statement you. 

3 List of lenders to which you plan to go do the sums, must be on a sheet of notebook paper and write answers to questions that are asked in the appropriate section. You want to ask about closing costs and if there is one year. You'll also want to compare interest rates and whether or not fixed. Consider the case of a broker or lender and any associated fee if it is an intermediary. 

You can use your money to a broker to take care of this, to save the dirty work of going around to get 3 quotes. A broker who will interact with lenders and then you are free to take the best offer. Search first though if you pay the broker or the lender. If you expect to pay the broker only to find potential lenders who may want to reconsider and find.

7. The Federal Truth in Lending Act

The Federal Truth in Lending Act was passed in order to protect consumers against unscrupulous lenders. In short, the Act requires every lender to disclose all terms of the loan to you at the time of application. They have to let you know what the terms of the loan, what fees must be paid, and the APR. 

The loan terms can not change once the lender has provided this disclosure, unless, of course, if you have a variable interest rate, which undoubtedly will change. You also have a 3-day right to cancel, and you are using your home as collateral. 

If something does not understand this disclosure statement, by all means ask questions. Much of the same information and the fee will be required as when you take your first mortgage so some of this will be very familiar. In any case, make sure you understand the terms of the loan agreement, and also ensure that follow according to the disclosure statement that has been provided. 

Advise if you need to keep your home safe and is able to use the insurance company of your choice or if you must use an approved lender. If you are taking out a line of credit instead of a lump sum loan, a notice of whether there is a large balloon payment at the end of the loan and make sure you have the means to make that payment.

8. Mobile homes

It is almost impossible to obtain a loan guarantee in a mobile home. Although many online advertising sites make loans secured mobile homes, that rarely happens. On the one hand, hardly lends money in a mobile home unless it is attached to land. So if you live in a mobile home because the thing is very wrong. The only lenders who lend money to a mobile home without land attached insist on a high credit score if you have to qualify, you have many options. 

Almost any lender making a loan guarantee with your mobile home will not do it once. Must be ample consideration even for this type of loan. 

In many states, if money is provided in a mobile home without land attached functions more as a loan for a car than a home loan. What this means is that if you default on the loan, including payments made past the grace period, instead of going through your mortgage, your home may simply be "dispossessed." Make sure you know what you sign when you take some kind of a mobile home loan.

9. Things to consider

Like any other financial arrangements which you have to know exactly who does business and the loan terms. There are unscrupulous lenders like to lend money to people they know can not afford a loan guarantee to your home and this gives the default to take advantage of their homes. Do not let this happen to you. If you can not afford to make payments, or even think about loan guarantee to your home. Carefully examine the terms of reimbursement, fees and charges related to the assessment of your home loan. Apply for a secured loan with the house only through a reputable lender. 

There will always be some kind of scam, is attentive to the people you're trying, but you might not illegal, are certainly contrary to professional ethics. Read every word of every document you will sign and not sign any blank page. If the agent or the lender says it needs no such letter, ignoring it, then if not written, just be sure that the contract should not happen.