How Does a HELOC Work?
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When you need to borrow some money to consolidate funds or make a large purchase, a home equity line of credit (HELOC) can be useful. A type of revolving credit, a HELOC is secured by the equity in your home. This open-ended loan may be be charged up or paid down during the loan term. The loan interest rate usually changes monthly
In a HELOC, the lending institution approves you for a specific credit amount - the highest sum you may borrow at any given time under the plan. In determining your credit limit, your pay-rate, outstanding debt, credit history and any other financial obligations will be reviewed. In order to assess your home' present market value, you will need an appraisal on your property. Your credit limit will be determined considering all of your financial information, in addition to a percentage of your property's appraised value, which is then subtracted from the balance owed on your current mortgage.
Agape Home Mortgage, LLC can walk you through the process of getting a Home Equity Line of Credit. Call us at 503-243-5626.