- Applying for a home equity loan generally resembles the process for applying for a mortgage. Applicants apply to the local lender, demonstrate their financial resources and then negotiate with lenders.
- A home equity loan can help reduce the applicant's taxes. In general, the interest on a home equity loan is tax deductible. This may not be true of other forms of loans, such as auto or education loans.
- A home equity loan can be used for any purpose desired. This can include home improvement, business capital or a higher education. The applicant generally does not have to tell the lender his reasons for borrowing money.
- Home equity loans can have less paperwork and fewer credit demands than other kinds of loans. The homeowner may be able to work with his current mortgage holder to renegotiate a new loan. Less paperwork can mean faster access to the desired sum as well as fewer closing costs than a traditional mortgage.
- Reverse mortgages are often used by elderly homeowners who have a lot of equity in their homes but may not have much cash on hand to face ongoing expenses such as medical needs. A reverse mortgage often carries the stipulation that the user need not pay back the sum of money borrowed until she passes away and the sum remaining is paid for by her estate.
The Process
Reduction in Taxes
Used for Any Purpose
Less Paperwork
Reverse Mortgages
SHARE
