Houses Loans, Home Loans Ontario
Are you confused about having to deal with heavy terms such as home equity and renovation loans in Mississauga? Worry not! The experienced professionals at Best Mortgage Rates Mortgages can help you in understanding these concepts and help you in making a viable decision.
We will take you through the entire process beforehand, take care of the paperwork and also make sure that you get an affordable interest rate without worrying about your finances. Get in touch with us today to learn more.
What is Home Equity Line of Credit and Home Equity Loan?
Home equity, is simply the difference that you owe on your home and the market’s value. To quote an example, if the market value of your home is $400,000 and you owe only $60,000, then $340,000 is the equity remaining in your home. The equity might be less when you start the mortgage payments, but as you near the completion date, it increases along with the ownership of your property.
It may not be possible to sell your equity, but home equity loan provide you an access to funds that can improve your financial situation. The requirements for a home equity loan may vary depending on the type of loan you apply for. The experienced mortgage agent s at Best Mortgage Rates can help you in understanding your loan options in Canada.
What are the Advantages of Home Equity Loan?
- Pay your credit card bills
- Complete your home renovation
- Buy that new car you’ve been wanting for a long time
- Use it to fund as capital for that business you’ve been dreaming to start and more
- Depending on the loan, you can withdraw a lumpsum amount, or in regular payments or whenever you need to withdraw it
- You can access the funds through credit cards or cheques
- Interest rates for home equity loans are usually way lower than unsecured loans and credit cards
You are using the equity of your property to secure some funds. Whatever percentage of the equity you kept as collateral will be given back to you when you start paying back the loan. Basically, you can use the money however you see fit.You are using the equity of your property to secure some funds. Whatever percentage of the equity you kept as collateral will be given back to you when you start paying back the loan. Basically, you can use the money however you see fit.
Are There Any Risks to Home Equity Loans?
Along with several amazing benefits, there are some disadvantages for home equity as well. It’s important to know everything in detail before you choose your loan option.
- Home equity line of credit have variable rates. So if your prime rate increases, so does the interest along with your monthly payments.
- Some of the home equity loan requires certain qualification, which might be difficult if you have low income or poor credit
- Some mortgages have high interest rates – some even up to 10%.
- Home equity line of credit and second mortgages require monthly payments, which might not be viable if you are a retiree.
- If you miss out on a home equity line of credit or second mortgage payment, you may even lose your home
- Unless the loan is a reverse mortgage, you will need to budget the payments
“Here, you not only get the best home equity loans agent in Mississauga, but a commitment that never fails!”