If you already own a home, you have known about equity loans and lines of credit. A home equity loan is a loan secured against your home. It is a loan in addition to your exiting mortgage. A line of credit is also secured against your home. However, you are not issued a check - you have access to funds up to the limit of the line of credit. A line of credit is, in many ways, similar to a credit card. It is a revolving line of credit. You can borrow money and pay it back as many times as you need to during the term of the loan. Understand the terms of the loan and if there are prepayment penalties. Homeowners/borrowers may be misinformed regarding the terms of a prepayment penalty mortgage (PPM). A prepayment penalty mortgage requires that you pay a fee (a percentage of the unpaid principal balance) if you repay your retire loan (or a substantial portion of it = any amount that exceeds 20% of the original principal balance) within a certain time period.
Here are the list of these nonprofit resources (free):
. Consumer Credit Counseling Services www.moneymanagement.org
. National Foundation for Credit Counseling www.nfcc.org 1-800-682-9832
. Neighborhood Reinvestment Corporation www.nw.org www.hud.gov
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