Both products allow you to borrow money using the equity you have in your home as collateral.
With a home equity loan, you receive a lump sum of money at closing. You are then required to make monthly payments on the loan. You will not be able to draw fund from the loan again. Since the funds are disbursed in full at the closing, your monthly payments will be fixed. Horizon Community Credit Union's home equity loans are adjustable rate loans, with the rate adjusting annually based on the terms spelled out in your loan. This can impact your monthly payment amount some, but generally it's not a large change.
The other way to borrow against your home’s equity is with a home equity line of credit (HELOC). This works more like a credit card – you have a credit limit, and you only pay on the funds you draw out. Monthly payments are 1% or 2% of the outstanding balance on the line. Much like a credit card, you can draw on the line multiple times. Horizon Community Credit Union's HELOCs are adjustable rate loans, with the rate adjusting annually based on the terms spelled out in your loan.
On both products you can borrow up to 80% of the appraised value of your home. For example, if your home is valued at $200,000 with a mortgage of $100,000, you would be able to apply for a home equity loan in the amount $60,000.
What could you use the equity in your home for??
Debt consolidation
Home Improvement
College tuition
Autos, motorcycle, Recreational vehicles
Vacation
Post by: Kelly B
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