One of the pluses of property ownership is the opportunity to build equity. If there's ever a time that you need a considerable amount of cash (such as for paying off debt or a home remodel), you'll have access to it by borrowing against your home equity. That's essentially the purpose of a home equity loan.
In this article, we'll review what a home equity loan is as well as alternatives that also give you access to lump sums.
Equity is based on the difference between what's owed on the mortgage and the home's current worth. For example, if your mortgage is $150,000, but your home appraises at $200,000, your equity is $50,000. The amount you're approved for in a home equity loan is based on this difference.
Home equity loans have fixed interest rates that are lower than personal loans or credit cards. So if you are looking to borrow a large sum, you're often better off with a home equity loan rather than a personal loan or charging it all to your card.
The biggest downside of a home equity loan is the requirement of using your home as collateral. So if you can't pay back the loan, you may lose your home to foreclosure.
A home equity line of credit (HELOC) acts similar to a credit card in that it has a credit limit, and you only pay back what you use. The credit limit is based on the amount of equity.
For example, if you get a HELOC of $45,000 but only use $15,000, you'll make payments just on the $15,000 (plus interest) not the full amount that you were approved for.
This option requires you to refinance into a new, higher-balanced loan where you then receive the additional funds in one lump sum.
For example, let's say your current loan is $145,000. You then refinance it into a new mortgage that now has a balance of $165,000. The $20,000 difference is what you'd receive in a lump sum, to use however you want.
Whichever option you choose, they all begin the same way --with an application. We've made it easy for you by offering a secure, online method of applying for a second mortgage. We're also available by phone and email to assist and answer any questions you may have about your loan options, qualifications, or the process. We aim to make this process as breezy and affordable as possible.
Start the process today and discover how easy it is to tap into your home equity to get the funding you need.
We've been helping customers afford the home of their dreams for many years and we love what we do.
Company NMLS: 1708787
7500 San Jacinto Place
Plano, Texas 75024
InTrust Mortgage, LLC strives to ensure that its services are accessible to people with disabilities. InTrust Mortgage, LLC has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.
InTrust Mortgage, LLC makes available the UserWay Website Accessibility Widget that is powered by a dedicated accessibility server. The software allows trustmylender.mortgage to improve its compliance with the Web Content Accessibility Guidelines (WCAG 2.1).
InTrust Mortgage, LLC accessibility menu can be enabled by clicking the accessibility menu icon that appears on the corner on the page. After triggering the accessibility menu, please wait a moment for the accessibility menu to load in its entirety.
InTrust Mortgage, LLC continues its efforts to constantly improve the accessibility of its site and services in the belief that it is our collective moral obligation to allow seamless, accessible and unhindered use also for those of us with disabilities.
Despite our efforts to make all pages and content on InTrust Mortgage, LLC website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.
If you are experiencing difficulty with any content on InTrust Mortgage, LLC website or require assistance with any part of our site, please contact us during normal business hours as detailed below and we will be happy to assist.
If you wish to report an accessibility issue, have any questions or need assistance, please contact us by sending an email to: info@InTrustLending.com