Shop Home Equity Lenders Before Making a Quick Decision

If you have a house with underlying equity and find yourself needing some extra cash, a home equity loan may be a good option. When you find yourself facing significant out-of-pocket expenses it’s likely too late for a traditional unsecured loan. When this happens many homeowners turn to home equity loans.  However, before you jump into anything you want to make sure you find the best home equity lender.

There are many uses of a home equity loan, but most borrowers use the extra cash to pay for a child’s college, fund home remodeling projects or even cover unexpected medical bills. Interest paid on these loans is tax deductible, which makes them a smart loan choice.

Even those with less than stellar credit can usually qualify for a home equity loan.  That’s because the borrower must have equity in their home so the lender has less risk.  If the borrower doesn’t pay back the loan, the home equity lender will eventually foreclose on the property. That being said, if you have poor credit don’t expect to find the lowest home equity rate.

There are many useful tools online for a home equity loan comparison. With a quick internet search, you can find a large number of lenders, and with most you can even complete an application online in just a few minutes. While you want to start with your search online, you should also talk with your current mortgage lender to see what they have to offer.

Once you have received several quotes from various lenders, you can start comparing the offers.  With every quote you receive you should also have a federal Truth in Lending statement which outlines all fees, payment terms and other home equity loan information. Legally, a lender cannot charge you any fees until they have provided this statement.  For more info on required lender disclosures, visit the Federal Reserve’s website at http://www.federalreserve.gov/Pubs/equity/equity_english.htm.

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