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, your fixed or adjustable rate loan is secured by the equity in your home. As with your first mortgage, you can borrow a particular sum of money to be paid back monthly over a period of time. People often use the phrases "home equity loan" and "second mortgage" to mean the same thing.
Home Equity Loan Specifics
Getting your first mortgage loan is a similar routine to that of a home equity loan. The closing costs (usually 2-3 percent of the loan amount) are usually smaller and, although your rate of interest is more on a home equity loan, the interest can be tax deductible.
You will have to document your salary and have good credit to qualify for a second mortgage. To figure out your home's current value, your lending institution will require a home appraisal. To talk about your home equity/second mortgage loan options, contact us at (909) 467-1090.