| Most Americans dream of owning their homes free | | | | rate and a fixed monthly payment avoid future |
| and clear someday, part of their retirement nest egg. | | | | payment shock and is the better alternative. Paying off |
| Yet, for many, this dream gets farther and farther | | | | your loan sooner obviously builds your home equity |
| from reality as they break into their home equity piggy | | | | more quickly. Think of it as forced savings. |
| banks. | | | | * Cash out refinances can make sense if you are |
| I am somewhat surprised at the number of our loan | | | | improving your overall mortgage terms and using the |
| applicants, even many of our excellent credit quality | | | | cash for an appropriate purpose. Again, consider |
| customers, who have taken equity out of their homes | | | | shortening your loan term if possible. |
| over the last few years via cash-out refinances or | | | | * Are you thinking about a home equity line of credit |
| home equity loans, says Gary Miller, a 25-year veteran | | | | (HELOC)? This product is marketed like a credit card |
| of the credit industry and CEO and co-founder of | | | | with adjustable teaser rates, ease of use and other |
| FirstAgain LLC, a financial services company based in | | | | incentives, encouraging you to use your home equity |
| San Diego, Calif. Now, with larger mortgages and often | | | | for just about anything with long repayment periods. |
| less equity, particularly with the recent home price | | | | Be careful. Having a HELOC in place may be prudent |
| depreciation hitting many areas of the country, these | | | | for certain purposes (for example, a future |
| people face a longer and more difficult path to | | | | emergency) if you can be disciplined about not |
| debt-free home ownership. | | | | normally using it and pay it down quickly if you do. |
| Before you decide to borrow against your hard | | | | * If you have excellent credit, you may qualify for an |
| earned home equity, consider the following: | | | | attractively priced unsecured loan that doesnt require |
| * Are you using your home equity for something that | | | | pledging the equity in your home. This type of loan, |
| actually adds value (equity) to your home, such as a | | | | such as FirstAgains AnythingLoan, offers highly |
| remodeling project or a swimming pool or for | | | | competitive, fixed interest rates and an ease of use |
| something important in your life such as a childs | | | | not available with mortgage products. Entirely online |
| education or unexpected medical bills? This can be a | | | | and paperless, you can apply in the morning and have |
| prudent way to finance such expenditures. Home | | | | $10,000 to $100,000 in your account by the afternoon. It |
| equity loan rates are attractive and the interest is | | | | takes just minutes versus the days required for a |
| usually tax deductible if you itemize. However, if you | | | | mortgage loan. |
| are using your home equity to finance vacations or | | | | Given the more difficult lending environment caused by |
| pay your bills, think again, as you may be | | | | the recent sub prime meltdown, home equity products |
| overextending yourself. | | | | have become both more expensive and more difficult |
| * Are you using a fixed rate home equity loan with the | | | | to obtain as lenders tighten their credit criteria and loan |
| shortest term you can easily handle? Adjustable rates | | | | to value guidelines, says Miller. Our product represents |
| may make sense for the financially well off (and | | | | a great alternative for those with excellent credit who |
| financially sophisticated) but for most people, a fixed | | | | dont have a home equity loan option. |