Home Equity Line of Credit
The home equity line of credit is the revolving loan, which the homeowners can take out using their home equity as collateral. As a homeowner, a home equity line of credit will allow you to borrow nearly 80% to 85% of your home value and use these funds gradually based on your needs. You pay interest on the borrowed money and the rates begin at prime plus 2% typically.
It is a loan of the variable interest rate type. If you opt for a home equity line of credit, then your home is used as collateral. You do not get all of your money in advance by going for a home equity line of credit, unlike the conventional mortgage. You can draw against the line as your need money; after that, you will pay interest on what you borrow. After settling down the principle, your line is replenished and can use again. If you are unable to pay the money back, your lender can foreclose your home eventually.
If you are confused about going for a home equity line of credit in NEWPORT BEACH, CA, you can call LGS Financial and Mortgage Services today to get information.