| The most common type of home equity loan
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| | life of the loan. The borrower is usually
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| is the term loan. This loan is set for a
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| | given special checks that he or she may
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| fixed amount of time, anywhere from five
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| | use to write checks against the loan
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| to fifteen years. Such loans are
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| | amount. The borrower may borrow a little
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| typically granted for up to 80% of the
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| | at a time, or borrow all of the loan
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| value of the home, but some lenders will
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| | amount at once. Unlike the term loan,
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| lend up to 125% of the home's value.
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| | the interest rate on lines of credit
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| Is this type of loan right for you? The
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| | tends to be variable. This type of loan
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| term loan works best for those who need
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| | works best for recurring expenses - a
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| to borrow a fixed amount of money for a
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| | complicated remodeling project
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| specific purpose - paying for a wedding,
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| | accomplished in several stages, or a
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| a home remodeling project, a fixed
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| | recurring educational expense such as
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| educational expense, or debt
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| | annual tuition.
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| consolidation. This would give the
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| | Each type of loan has its advantages and
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| borrower a fixed repayment schedule,
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| | disadvantages; you simply need to decide
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| where he or she would pay a set amount of
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| | if you want a fixed interest rate and
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| money each month for a specific period of
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| | fixed payments, or more flexibility in
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| time.
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| | terms of when and how you pay. Your
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| An increasingly popular alternative to
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| | needs will determine which type of loan
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| the home equity loan is a line of credit.
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| | is best for you.
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| This type of loan works like a credit
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| | Either way, under current Federal law,
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| card, and has a revolving line of credit,
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| | the interest on a second mortgage is
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| in which the borrower may borrow against
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| | deductible from your income taxes up to
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| the principal more than once over the
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| | $100,000.
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