Home Equity Line of Credit
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If you have a need for some extra cash to make a major purchase, renovate your home, or pay the balance on a high interest credit card, a HELOC (home equity line of credit) might be just what you are looking for. Using your home equity as collateral, a HELOC is revolving credit. This is an open-ended loan that can be paid down or charged up for the term of the loan, much like a credit card. The loan interest generally changes monthly based on the Prime Rate and a margin.
With a HELOC, your lender will approve you for a specific credit amount - the maximum sum you can borrow at any one time under the plan. Your credit score, rate of pay, debt and various other financial circumstances will affect your credit limit. An appraisal is needed on your home to determine the property's market value. Your property's current value, subtracted from your remaining mortgage balance will help to set your specific credit limit.
Let's say you want to purchase a new home and own your present home free and clear. We have helped people with the purchase of their new home with a first mortgage and a line of credit on the new house. Once your prior residence sells, you pay off the line of credit and it is still available to you for 10 years to come if you need it. It's a forward thinking way of making good use of your money.
Sherry Bitner will walk you through the process of getting a Home Equity Line of Credit. Call us: 941-504-1445.