Home Equity Line of Credit: the Facts
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If you have a need for some extra cash to make a large purchase, renovate your home, or pay off a high interest credit card, a HELOC (home equity line of credit) may be just what you're looking for. Using your home equity as collateral, a HELOC is revolving credit. This is an open ended loan that may be paid down or charged up for the a set length of time, similar to a credit card. The interest rate can fluctuate (typically every month).
In a HELOC, your lender approves you for a specific credit amount - the maximum amount you are able to borrow at any given time under the plan. In setting the credit limit, your pay-rate, debts, credit status and any other financial circumstances will be reviewed. You are required to have a home appraisal to assess your home's up-to-date value. Your credit limit will be based considering all of the above, in addition to a fraction of your home's appraised value, which is subtracted from the balance owed on your current mortgage.
Empower Lending Group can walk you through the process of getting a Home Equity Line. Call us at 310-686-1313.