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Tips for Selling Your Home
By Roberto Irby
As a homeowner, there are several things you can do to help sell your real estate in Washington. After you have completed the usual steps of pricing the home and putting out advertisements, you need Read more...

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Your Home Business and Your Taxes
By Adam Heist
With the internet in its phase two of a bubble, the growth in home businesses has been large as well. Your home business is convenient to you, only involving going places through the internet, and Read more...
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Home Based Businesses Can Produce Steady Income
By Don Emmons
ke Money Working At Home - Internet Marketing Really WorksYour home-based business can produce steady income for you and your family if you follow a few simple rules.Focus on people's Read more...
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What Home Spy Camera Do You Want?
By Dan Crane
Many regular homeowners want a spy camera to protect themselves from thieves and burglars. Another reason is that they may want to spy on some of their family members. Such homeowners usually do not Read more...

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#Welcome to Home Buyers Boot Camp real estate listings buyers guides - your comprehensive first time home buyers resource.

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Securing A Home Equity Loan
By Peter Kenny
If you own a home, then one way to free up extra money to consolidate debt or to make improvements is to take out a equity loan. A equity loan is money that you borrow against the money you have paid towards your property. The amount you can borrow depends on the level of equity that you have, which is determined by your property value minus the amount you have outstanding on your mortgage. The equity is used as collateral to obtain a loan, which is basically a second mortgage. Rates on these types of loans are slightly higher than normal mortgages, but still low compared to other types of loans.

Why a equity loan?

A equity loan has a number of advantages. Firstly, it can be used to get credit even if your credit rating is poor, because you are putting up collateral. Also, there are significant tax savings over normal loans as the interest paid on a equity loan is tax-deductible. Also, you can borrow a lot more money than you usually can through an unsecured loan. You could use your equity loan to consolidate your high interest debts, to make improvements or buy other costly items. However, before you get a equity loan you should look at the possible dangers involved, as some lenders can cost you a lot of money by not giving you all the facts. Here are some of the dangers of equity loans:

Equity stripping

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One problem that can occur with equity loans is equity stripping. If you get a loan knowing that you cannot make the monthly repayments, a lender might give you the loan anyway. The lender is not concerned if you make the payments or not, as they can simply take away the equity in your home. To avoid this, be honest with yourself and only take out a loan that you know you can afford, even if you get offered more.

Balloon payments

If you are struggling with your current payments, then a lender might offer a equity loan at a much lower price than you are paying right now. This may seem attractive, but it usually involves a hidden ‘balloon’ payment at the end. Your payments are lower because you are only paying the interest back, but at the end of the loan term you need to pay the amount in full. This is likely to leave you in financial trouble and you may lose your home. To avoid this, make sure that you can easily afford your monthly payments, and if you do have to refinance make sure you can afford the final payment.

Credit insurance

One of the most costly aspects of a equity loan is credit insurance. You have agreed to a loan that is within your budget, but the lender then adds on extra features that you do not need, such as credit insurance. These items can significantly increase the amount you pay back, and often cover you for a minimal amount of situations. Before you sign anything, check that the terms are for the loan payments only, and not for extra insurance. If you do want insurance, you can usually find it cheaper elsewhere.
If you decide to get a equity loan to consolidate your debts or free up some money, remember to look around for the best deals and to avoid signing anything that will cost you more money than you can afford.
For additional articles and an extensive resource for everything about credit cards and finance, please visit us at Compare Credit Cards and Mortgages UK
Visit www.creditcards-gb.co.uk


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