Home Equity

Home equity is the difference between the appraised value of your home and the remaining balance of your home loan. As a homeowner, you build home equity by making a down payment and making principal payments against your mortgage.

If the value of your home increases on the fair market, you stand to benefit from the potential increase in home equity when you sell your property. This is another way to increase home equity.

Home equity can be used as collateral for home equity loans or home equity lines of credit (HELOC). So, if you have home equity, you may be able to use it as a lower interest solution than typical credit cards provide.

Home Equity Loans

A home equity loan allows you to borrow against the equity in your home to receive a lump sum loan. Using a home equity loan, you may be able to:

Home Equity Lines of Credit (HELOC)

A HELOC offers a flexible way to access funds when you need them. They are different from home equity loans in that you can draw money as you need it rather than taking out a single lump sum loan. A HELOC is a revolving line of credit, like a credit card. But it typically carries a lower interest rate because the line of credit is secured by your home equity. You can borrow funds up to a predefined limit and the interest charged directly corresponds to the amount you borrow.

Over time, your revolving credit line can be paid down and then reused during your draw term, which is typically between 5 and 10 years, and you only pay interest during this time. When the draw term ends, you can choose to pay the balance in full or pay according to a set schedule. Interest must still be paid at this time. You may also decide to refinance the equity line for another set draw term.

With a HELOC from CrossCountry Mortgage, Inc., you can:

The benefits of HELOCs include:

A home appraisal may be required to obtain a HELOC

Contact a licensed loan officer with CrossCountry Mortgage, Inc. today to learn more about how home equity solutions can help you.

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