Perhaps you are considering tapping into your home equity to renovate your kitchen, or take care of the balance on a credit card. A home equity loan is a fixed or adjustable-rate loan that uses the equity in your home as collateral. Similar to your first mortgage, you can borrow a specific amount to be paid back monthly over a certain period of time. A home equity loan can also be called a second mortgage.
You will be comfortable with the process as it's much like getting your current mortgage. You will be happy to know the closing costs are lower with a home equity loan, and although there is a larger interest rate than a traditional mortgage loan, the interest can be deducted from your taxes.
You will have to provide income verification and have good credit to qualify for a second mortgage. To figure out your home's market value, your lender will ask for an appraisal of your home. To check on your home equity/second mortgage loan options, call us at (562) 693-5048.
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