Some home equity loans come with low introductory rates and variable interest; others come with fixed rates. Some loans have balloon payments at the end of the term as a way to keep the monthly payments lower.
The Right Time For A Home Equity Loan
A home equity loan makes financial sense when,
- you can pay off high-interest debts like credit cards, car loans or medical expenses with home equity refinancing thatâs not subject to rising interest rates.
- there is enough equity built up in your house so you can borrow less than 80% of the homeâs value. This means you wonât have to pay Private Mortgage Insurance.
- you wonât be moving anytime in the next few years. That way the loan expensesâclosing costs, loan fees, discount pointsâon the new mortgage will be paid back cost-effectively.
- interest rates are a percentage point or more below what you are currently paying on your mortgage.
you want the convenience of consolidating your bills into a single monthly payment with a fixed repayment term.
Anytime you get a loan using your principal residence to guarantee repayment, federal credit law gives you three days to reconsider a signed credit agreement and cancel the deal without penalty. This âright to rescindâ is guaranteed by the Truth In Lending Act. You have until midnight of the third business day to cancel the credit transaction.
You can learn how to avoid Home Equity Loan scams, plus get a free quote at Easy Mortgage Refinancing. This is a no-risk way to see how much you might be qualified to borrow with a home equity loan.This article is free for republishing
Source: http://www.articlealley.com/article_191369_19.html
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