Posted on: 24th Jul, 2009 01:11 pm
are home equity loan and second mortage, heloc the same thing? kind of confused by the terms...
Hi jk,
A home equity loan is a closed-end type of loan. Here, you receive a check for the amount of the loan that you close on. You make regular monthly payments to pay off the loan over a certain period of time. In future, if you wish to borrow additional money, you will have to take a new equity loan.
A home equity line of credit (HELOC) is much like a credit card. You can withdraw money again and again. In future if you require additional money, you can borrow that, provided the amount does not exceed the original HELOC amount. Thus, if you take a HELOC of $50k and pay off $20k towards the principal, you can withdraw $20k again from your line of equity.
A home equity loan is a closed-end type of loan. Here, you receive a check for the amount of the loan that you close on. You make regular monthly payments to pay off the loan over a certain period of time. In future, if you wish to borrow additional money, you will have to take a new equity loan.
A home equity line of credit (HELOC) is much like a credit card. You can withdraw money again and again. In future if you require additional money, you can borrow that, provided the amount does not exceed the original HELOC amount. Thus, if you take a HELOC of $50k and pay off $20k towards the principal, you can withdraw $20k again from your line of equity.
jk9999
HELOC is more related to the fact that it is line of credit simply as that of cash credit account offered by banks whereas
simple equity loan is one time home loan and you can not borrow so many times....
keep in touch....
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HELOC is more related to the fact that it is line of credit simply as that of cash credit account offered by banks whereas
simple equity loan is one time home loan and you can not borrow so many times....
keep in touch....
:arrow: :arrow: :arrow: