Should You Consider Taking Out a Home Equity Loan? | First Volunteer Bank
You may have heard the phrase “home equity loan,” but do you really know what that is and how it can be used? It can be hard to make sense of all the TV commercials and ads you see.
That’s why our team at First Volunteer Bank is taking a look at the home equity loan—and how and when it can be used.
Understanding the Home Equity Loan
A home equity loan is a loan that allows you to borrow against the equity in your home. You have two choices when it comes to deciding to utilize a home equity line of credit (also known as a HEL), fixed and adjustable loans.
With a fixed rate loan, your interest rate is set for the length of the loan, while with an adjustable rate loan, your interest rate may fluctuate up or down over time.
Many people use home equity lines of credit for large items like:
- Consolidating debt
- Making home improvements
- Funding an extravagant vacation or wedding
- Paying for higher education
How Can I Get a Home Equity Line of Credit?
If you’d like to learn more about home equity loans, talk with our team of professionals. We can help you understand the options and whether this type of loan is best to meet your needs.
Once you decide to pursue a home equity line of credit, financiers will determine how much equity you have in your home, which will determine the amount of credit extended to you.
While you can technically obtain a home equity line of credit as soon as you purchase a home, most homeowners need at least five to seven years in order to really build equity in their home.
Are you looking to obtain a home equity loan? Contact the First Volunteer Bank team today to learn how we can help.