Mortgage & Refinancing Information


Home Equity Loan Risks


Home equity loans give individuals a tool to extend their existing credit line by securing debt on the equity value of their existing homes. This access to easy and cheap money can lure the borrower into securing a debt for reasons which otherwise could have been funded through wise money management.

Following are some home equity loans risks:

Risk of losing one's home:

The biggest risk involved in home equity loans is that of the borrower being rendered homeless. In the case of the borrower being unable to make timely payments of the interest and the principal, the lender can claim the existing house of the borrower. Thus a default in payment can lead to the loss of the home, which is used as collateral for the loan.

Hidden loan conditions:

Consumers who do not pay careful heed to the fine print may fall prey to the intrinsic conditions of the home equity loan, particularly those pertaining to principal and interest payments. For example, a balloon payment of the principal may add to the debt burden of the borrower and the inability to make the payment may result in foreclosure and thus loss of the borrower's house. The lender may also impose legal and procedural fees later on in the term of the loan, which may affect the actual amount payable by the consumer.

Higher interest payments:

If the equity loan is financed at a floating or variable rate, then it is subject to changes depending on the interest rate scenario in the economy. This may be because the interest payments fluctuate out of the bounds of the borrower's reach.

Besides these major risks, the home on which the loan is secured cannot be leased during the term of the loan. The loan on home equity will also effectively increase the time required to pay off the debt on the existing home.

Many times, the easy availability of an equity loan can tempt a consumer to take the loan for day-to-day expenses, which actually add to his existing debt burden.

The investment made by the money raised through raising an equity loan should be financially more rewarding than the interest paid on the loan.

All these factors should hence be taken into consideration before taking a home equity loan.

Home Equity Loans - Rates, in depth articles and professional second mortgage advice. Find the lowest home equity loans rates and lenders.


MORE RESOURCES:
This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news


Bankrate.com

Refinance rates increase for Wednesday
Bankrate.com
The average 30-year fixed-refinance rate is 4.49 percent, up 20 basis points since the same time last week. A month ago, the average rate on a 30-year fixed refinance was lower, at 4.28 percent. At the current average rate, you'll pay $506.09 per month ...

and more »


Student Loan Hero (blog)

What does it mean to refinance a loan?
Student Loan Hero (blog)
Look through different rates and repayment terms to find the best one for your financial situation. Make sure you're prepared to refinance before you get started. If you're refinancing credit cards, you might want to take out a personal loan. Personal ...



Chicago Tribune

Mortgage rates haven't been this high since 2013
Chicago Tribune
Meanwhile, mortgage applications were flat last week, according to the latest data from the Mortgage Bankers Association. The market composite index - a measure of total loan application volume - decreased 0.2 percent from a week earlier. The refinance ...
Mortgage rates surge to highest since 2013MarketWatch

all 21 news articles »


Bankrate.com

Refinance rates tick higher for Thursday
Bankrate.com
The average 30-year fixed-refinance rate is 4.52 percent, up 22 basis points since the same time last week. A month ago, the average rate on a 30-year fixed refinance was lower, at 4.24 percent. At the current average rate, you'll pay $507.87 per month ...

and more »


CNBC

Weekly mortgage applications stall as rates make sharp move higher
CNBC
Mortgage interest rates last week didn't start to climb until the end of the week, but even a few days were enough to dampen demand. Total mortgage application volume fell 0.2 percent for the week and was 0.8 percent lower than a year ago, according to ...
MBA: Mortgage Applications Fall SlightlyBuilder Magazine
Refi applications hit almost 10-year low on interest rate growthNational Mortgage News
Mortgage Applications Down AgainNational Mortgage Professional Magazine

all 14 news articles »


BRIEF-Jordan Mortgage Refinance Q1 Profit Rises
Reuters
BRIEF-Jordan Mortgage Refinance Q1 Profit Rises. Reuters Staff. 1 Min Read. April 24 (Reuters) - JORDAN MORTGAGE REFINANCE COMPANY PSC : * Q1 PROFIT 771,404 DINARS VERSUS 481,174 DINARS YEAR AGO Source:(bit.ly/2vGvYdD) Further company coverage: Our ...



Bankrate.com

Refinance mortgage rates mixed for Wednesday
Bankrate.com
The average 30-year fixed-refinance rate is 4.25 percent, unchanged over the last week. A month ago, the average rate on a 30-year fixed refinance was higher, at 4.28 percent. At the current average rate, you'll pay $491.94 per month in principal and ...

and more »


World Property Journal

Mortgage apps down as 30-year rate hits 5-year high
Mortgage Professional America
There was a slight decrease in new mortgage applications last week as refinance activity continued to weaken amid rising rates. The Mortgage Brokers Association's Market Composite Index was down 0.2% (seasonally adjusted) for the week ending April 20 ...
Mortgage Applications Volumes Dip in Mid-AprilWorld Property Journal

all 2 news articles »


Forbes

Using Your Home Equity For Aging In Place
Forbes
A new Bankrate survey says 62% of homeowners never plan to move. If you're one of those who'll be aging in place, you may be considering using your home equity to help do it, by taking out a reverse mortgage, a home equity line of credit (HELOC) or a ...

and more »


SFGate

Just Approved: Reverse mortgage and conventional refinance enable home exchange
SFGate
Mortgage adviser: John Holmgren, Holmgren & Associates. Property types: Single-family homes in Berkeley. Price: Loan structure avoided tax reassessment. Loan type: FHA HECM reverse mortgage $319,000 at 4.2 percent; conventional 30-year fixed refinance ...

and more »

Google News

home | site map
© 2007