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Equity and Lines of Credit Mortgages Explained

Equity Mortgage

House with roof

          An Equity mortgage is a mortgage based on the value of your home.  Not to  be confused with   a HELOC (Home Equity Line of Credit) an equity mortgage will  have a fixed interest rate, set term   and amortization period.  It can either be  classed as a first mortgage or second mortgage and is   usually used for  major renovations or debt consolidations.  Some lenders wi not   require you to show income when the amount of the loan is less than 50% of the home value but   you will need a fairly good credit rating.  If you have a poor credit rating and have equity in your   home, a two step process may be the best way to go.  First a private mortgage while rebuilding   your credit rating then moving into an equity mortgage at a better interest rate for the long term.

Lines of Credit

Apartment        A home equity line of credit is a re-advance able loan that is set up for either  interest only   payments or a minimum payment.  If you are going to carry a  balance on your credit cards or   have a personal loan this type of mortgage will  save you thousands of dollars over the life of the   mortgage.  depending on your needs, you can go as high as 95% of the value of your home   subject to your credit rating, income and other debts.  A Home Equity Line of Credit is one of the   cheapest and quickest access to money and should be part of a homeowners financial emergency   and every day plan.

      Almost every lender offers a HELOC and some go as far as to offer an all-in-one mortgage   product where you have a fixed mortgage, line of credit and credit card extending from one             ;                                       mortgage loan.

If you have any questions about HELOC's or Equity mortgages please use the form below.