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Home Equity Loans in Essex

To get this type of loan, you must present a piece of real estate as security. It is provided by home equity lenders who do not care for the credit score as much as banks do. They are guided by home equity, which is more important in their trade. We have professional loan experts with years of experience giving home equity loans in Essex, ON. We also serve other cities in the province including Lincoln, Cambridge, Toronto, and Midland to name but a few.

Payment Terms and Options for Home Equity Loans

The usual home equity loan is actually the first or second mortgage you take with a property. The lenders extend a registered mortgage at interest fees between 7% 15% for an entire year. The registered mortgage agreement allows a lender to activate a power of sale if you default but it is also an open mortgage meaning you can finish payments before they are due. For the private lenders to accept your decision, you must pay a fine of three months interest as a penalty. Particularly different from a bank mortgage, it is possible to have a home equity loan tailored to your needs. Our specialists will discuss them and design the most appropriate loan for you.

What are the Popular Custom Choices

  • Interest Only Mortgage: For this loan, you pay only the interest and leave the principal unaltered.
  • Construction Draw Mortgage: We can lend you the money to pay your construction workers till the building project is completed.
  • Blanket Mortgage: We can accept more than one house as security for the same loan. This comes in handy when trying to acquire more funding.

Due to the diverse needs of clients, our lenders will work more options in the agreement. Feel free to discuss them and our vibrant team will suggest some available custom loans for you.

How Much Will You Get With a Home Equity Loan

Whatever amount of money a home equity lender is willing to give depends on how big of a debt burden is on your property. To measure this, home equity lenders must calculate, LTV, a metric of utmost importance. This is obtained by dividing debts by the appraised property value in the hopes of getting a value that is 85% or less. Our home equity lenders in Kingsville are willing to loan up to 85% property LTV as it means there is 15% equity left for them to leverage in case you default. LTV may be the most important factor when making lending decisions but some also judge clients according to credit and annual income.

How is a Loan Commonly Used

From years of experience in the market, our lenders have seen many uses for the money. The borrower is free to decide how this loan is used as they know best. Payment of debts, investing in renovations and education are some of the most popular uses for this money but some clients only need it to pay for vacations or to make hefty car payments.

  • Renovation: Sometimes you need to repair and upgrade your home to increase its value in case you ever need to sell it.
  • Education: You can pay your school fees or finance your kid’s college education.
  • Business Investing: The loan can be used as a viable source of capital for your business.
  • Debt consolidation: You can use the money to pay off other expensive loans so you are left with a single big, yet affordable loan.

Less popular uses include stopping a power of sale or foreclosure, helping loved ones or paying for medical emergencies.

Differences Between a Home Equity Loan and Home Equity Line of Credit

Also known as an HELOC, a home equity line of credit is a type of revolving credit. This means that like a credit card, the interest rates and payment period are subject to change. Different from that is a home equity loan is a type of installment loan with fixed interest rates and a set deadline for payment. The only reason why people confuse the loans is that approval for both relies on the property loan to value ratio.

 

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