| Home Equity is the difference between the fair market | | | | If you have bankruptcy or bad credit issues, a home |
| value (appraised value) of the home and the | | | | equity loan or line of credit may be right for you. |
| outstanding mortgage balance. Because the home is | | | | Before making a decision, you should carefully weigh |
| likely to be a consumer's largest asset, many | | | | the costs of a home equity line against the benefits. |
| homeowners use a home equity loan for major | | | | Shop for the loan terms that best meet your |
| expenses such as education, home improvements, | | | | borrowing needs without posing unnecessary financial |
| medical bills, or debt consolidation. | | | | risk. You can apply for and obtain more information on |
| A home equity loan is a type of mortgage in which | | | | home equity loans through a mortgage broker, your |
| your home serves as collateral. Home equity loans can | | | | bank or credit union. |
| either be a revolving line of credit known as a HELOC | | | | The federal Truth in Lending Act requires lenders to |
| (Home Equity Line of Credit) or a one-time, closed-end | | | | disclose the important terms and costs of their |
| loan sometimes referred to as a 2nd mortgage. A | | | | mortgage products, including the APR, miscellaneous |
| revolving credit line lets you choose when and how | | | | charges, the payment terms, and information about |
| often to borrow against the equity in your home. In a | | | | any variable-rate feature. And in general, neither the |
| closed-end loan, you receive a lump sum of cash. | | | | lender nor anyone else may charge a fee until after |
| Interest on these types of loans are usually tax | | | | you have received this information. |
| deductible. | | | | |