Home Equity Loan Lenders
Are you looking for a home equity lender? Consider this before
you get started......
Using a credit line to borrow against the equity in your home
has become a popular source of consumer credit. And lenders are offering these
home equity credit lines in a variety of ways.
You will find most loans come with variable interest rates, some come with
attractive low introductory rates, and a few come with fixed rates. You also
may find most loans have large one-time upfront fees, others have closing costs,
and some have continuing costs, such as annual fees. You can find loans with
large balloon payments at the end of the loan, and others with no balloons but
with higher monthly payments.
FHA Mortgage Loans and No Hope for Home Owners
Mortgage Loan Blog Posts
|Hard Money Lenders in California Announce Private Money Loans - Thousands of consumers in states like California are unable to meet conforming loan standards.
|Home Loans for People with Bad Credit - With many parts of the country experiencing a bounce in rising house values, many home equity lenders have rolled out new lending alternatives, but no equity lending is still difficult for people with low credit scores.
|In a recent article written by Bryan Dornan, he reflects on the subprime mortgage problems starting in 2006 and brings us up to speed with FHA and the foreclosure crisis. Read more about Internet Mortgage Marketing.
No one loan is right for every homeowner. The challenge, then, is to contact
different lenders, compare options, and select the home equity credit line best
tailored to your needs.
Be sure to review the home equity contract carefully before you sign it. Do
not hesitate to ask questions about the terms and conditions of your financing.
To help you do this, you may want to consider the following questions and to
use the checklist at the end of this brochure. (We apologize that the checklist
is not available on-line. To obtain a copy of the checklist, please request
a free copy of the brochure by contacting: Public Reference, Federal Trade Commission,
Washington, D.C. 20580; (202) 326-2222. TDD call (202) 326-2502.)
Home Equity Lender Directory
Second Mortgages Direct
This 2nd mortgage specialist offers all types of second mortgages.
Lending group provides wholesale interest rates for credit lines, and fixed "home equity loans".
Home Loan Wholesale
Compare Home Equity Lenders on the HLW directory at no charge.
Be sure to review the home equity contract carefully before you sign it. Do not hesitate to ask questions about the terms and conditions of your financing.
To help you do this, you may want to consider the following questions and to use the checklist at the end of this brochure.
Is a home equity credit line for you?
If you need to borrow money, home equity lines may be one useful source of
credit. Initially at least, they may provide you with large amounts of cash
at relatively low interest rates. And they may provide you with certain tax
advantages unavailable with other kinds of loans. (Check with your tax adviser
At the same time, home equity lines of credit require you to use your home
as collateral for the loan. This may put your home at risk if you are late or
cannot make your monthly payments. Those loans with a large final (balloon)
payment may lead you to borrow more money to pay off this debt, or they may
put your home in jeopardy if you cannot qualify for refinancing. And, if you
sell your home, most plans require you to pay off your credit line at that time.
In addition, because home equity loans give you relatively easy access to cash,
you might find you borrow money more freely.
Remember too, there are other ways to borrow money from a lending institution.
For example, you may want to explore second mortgage installment loans. Although
these plans also place an additional mortgage on your home, second mortgage
money usually is loaned in a lump sum, rather than in a series of advances made
available by writing checks on an account. Also, second mortgages usually have
fixed interest rates and fixed payment amounts.
You also may want to explore borrowing from credit lines that do not use your
home as collateral. These are available with your credit cards or with unsecured
credit lines that let you write checks as you need the money. In addition, you
may want to ask about loans for specific items, such as cars or tuition.
How much money can you borrow on a home equity credit line?
Depending on your creditworthiness (your income, credit rating, etc.) and the
amount of your outstanding debt, home equity lenders may let you borrow up to
85% of the appraised value of your home minus the amount you still owe on your
first mortgage. Ask the lender about the length of the home equity loan, whether
there is a minimum withdrawal requirement when you open your account, and whether
there are minimum or maximum withdrawal requirements after your account is opened.
Inquire how you gain access to your credit line -- with checks, credit cards,
Also, find out if your home equity plan sets a fixed time -- a draw period
-- when you can make withdrawals from your account. Once the draw period expires,
you may be able to renew your credit line. If you cannot, you will not be permitted
to borrow additional funds. Also, in some plans, you may have to pay your full
outstanding balance. In others, you may be able to repay the balance over a
What is the interest rate on the home equity loan?
Interest rates for loans differ, so it pays to check with several lenders for
the lowest rate. Compare the annual percentage rate (APR), which indicates the
cost of credit on a yearly basis. Be aware that the advertised APR for home
equity credit lines is based on interest alone. For a true comparison of credit
costs, compare other charges, such as points and closing costs, which will add
to the cost of your home equity loan. This is especially important if you are
comparing a home equity credit line with a traditional installment (or second)
mortgage, where the APR includes the total credit costs for the loan.
In addition, ask about the type of interest rates available for the home equity
plan. Most home equity credit lines have variable interest rates. These variable
rates may offer lower monthly payments at first, but during the rest of the
repayment period the payments may change and may be higher. Fixed interest rates,
if available, may be slightly higher initially than variable rates, but fixed
rates offer stable monthly payments over the life of the credit line.
If you are considering a variable rate, check and compare the terms. Check
the periodic cap, which is the limit on interest rate changes at one time. Also,
check the lifetime cap, which is the limit on interest rate changes throughout
the loan term. Ask the lender which index is used and how much and how often
it can change. An index (such as the prime rate) is used by lenders to determine
how much to raise or lower interest rates. Also, check the margin, which is
an amount added to the index that determines the interest you are charged. In
addition, inquire whether you can convert your variable rate loan to a fixed
rate at some future time.
Sometimes, lenders offer a temporarily discounted interest rate -- a rate that
is unusually low and lasts only for an introductory period, such as six months.
During this time, your monthly payments are lower too. After the introductory
period ends, however, your rate (and payments) increase to the true market level
(the index plus the margin). So, ask if the rate you are offered is "discounted,"
and if so, find out how the rate will be determined at the end of the discount
period and how much larger your payments could be at that time.
What are the upfront closing costs?
When you take out a home equity line of credit, you pay for many of the same
expenses as when you financed your original mortgage. These include items such
as an application fee, title search, appraisal, attorneys' fees, and points
(a percentage of the amount you borrow). These expenses can add substantially
to the cost of your loan, especially if you ultimately borrow little from your
credit line. You may want to negotiate with lenders to see if they will pay
for some of these expenses.
What are the continuing costs?
In addition to upfront closing costs, some lenders require you to pay continuing
fees throughout the life of the loan. These may include an annual membership
or participation fee, which is due whether or not you use the account, and/or
a transaction fee, which is charged each time you borrow money. These fees add
to the overall cost of the loan.
What are the repayment terms during the loan?
As you pay back the loan, your payments may change if your credit line has
a variable interest rate, even if you do not borrow more money from your account.
Find out how often and how much your payments can change. You also will want
to know whether you are paying back both principal and interest, or interest
only. Even if you are paying back some principal, ask whether your monthly payments
will cover the full amount borrowed or whether you will owe an additional payment
of principal at the end of the loan. In addition, you may want to ask about
penalties for late payments and under what conditions the lender can consider
you in default and demand immediate full payment.
What are the repayment terms at the end of the loan?
Ask whether you might owe a large payment at the end of your loan term. If
so, and you are not sure you will be able to afford the balloon payment, you
may want to renegotiate your repayment terms. When you take out the loan, ask
about the conditions for renewal of the plan or for refinancing the unpaid balance.
Consider asking the lender to agree ahead of time and in writing to refinance
any end-of-loan balance or extend your repayment time, if necessary.
What safeguards are built into the loan?
One of the best protections you have is the Federal Truth in Lending Act, which
requires lenders to inform you about the terms and costs of the plan at the
time you are given an application. Lenders must disclose the APR and payment
terms and must inform you of charges to open or use the account, such as an
appraisal, a credit report, or attorneys' fees. Lenders also must tell you about
any variable-rate feature and give you a brochure describing the general features
of home equity plans.
The Truth in Lending Act also protects you from changes in the terms of the
account (other than a variable-rate feature) before the plan is opened. If you
decide not to enter into the plan because of a change in terms, all fees you
paid earlier must be returned to you.
Because your home is at risk when you open a home equity credit account, you
have three days to cancel the transaction, for any reason. To cancel, you must
inform the lender in writing. Following that, your credit line must be cancelled
and all fees you have paid must be returned.
Once your home equity plan is opened, if you pay as agreed, the lender, in
most cases, may not terminate your plan, accelerate payment of your outstanding
balance, or change the terms of your account. The lender may halt credit advances
on your account during any period in which interest rates exceed the maximum
rate cap in your agreement, if your contract permits this practice.
Benefits of Home Equity Loans & How to find the Best Lenders
- No Equity Required
- Don't need to touch your existing Low Rate 1st Mortgage
- Tax Deductible
- Consolidating Debts will Lower your Monthly Payments
- 125% Second Mortgage
- 1st Time Homebuyers OK
- Poor Credit OK
- No Verification Income Loans
- Self Employed Borrowers OK
- Interest Only Loan Options
- Home Equity Lines of Credit
Free Mortgage Quote
No obligation & No cost