Hey all,
I have tried to search this and couldnt come up with much information. If there is another thread regarding this please direct me to it:) thanks.
I am trying to get some information regarding home equity loans. A few questions, are there points involved with home equity loans? If I own the home with no mortgage payments, how much of the appraised value could I get in a home equity loan?
Also, is a home equity loan similar to a mortgage? If they are different, how do they differ?
I am trying to buy a $20k home for 15k on credit card and then get a home equity loan for a bit more then 15k to pay back the credit card. From what I hear it is hard to get a mortgage so I’m getting creative.
Thanks,
Herschel
A few questions, are there points involved with home equity loans?
No. Home Equity Loans or Line of Credit (HELOCs) are generally based on Prime rate which is currently 7.25%. Depending on the Loan to Value (LTV) and your qualifying factors, it may be Prime Rate plus a %. It also depends on if it is a first or second lien HELOC.
If I own the home with no mortgage payments, how much of the appraised value could I get in a home equity loan?
Depending on the qualifying factors…up to 100%.
Also, is a home equity loan similar to a mortgage? If they are different, how do they differ?
A HELOC is similar to a credit card , in that, as you pay it down the paid down portion becomes available, again.
Consult your tax advisor, but, I believe you can write your LOC expenses off.
Mark,
Firstly, I bet I can do a search and come up with alot more data on home equity being that I didnt know that that is what a HELOC is:) Live and learn!
Is it going to be a problem to get a HELOC on a $20k home or this is wont be an issue because its not a mortgage? The reason why I would by on credit card and then get the HELOC to pay the card is because I want to be able to buy another SFH before the loans are paid up. So once I get the HELOC to pay the credit card I would be able to buy another home with the credit card.
Is it going to be a problem to get a HELOC on a $20k home or this is wont be an issue because its not a mortgage?
First, HELOCS will go as low as 10K.
Second, a HELOC is a mortgage and will be placed as a lien on the property as I mentioned previously.