A home equity loan is offered to borrowers ready to put up their homes as security. Approval for such a loan depends on equity, as indicated in the name. Lenders here are not concerned about credit and employment history because to them true value lies in the equity left on a property. We have a team of experienced professionals who can provide home equity loans in Thunder Bay.
A traditional home equity loan is a first or second mortgage provided by private institutions for a period of one year. The interest rate is 7%-15% and there is an option to end things early. Going this way allows you to finish making payments and move on to other matters but what’s important is that it builds your credit score. Despite the higher than usual interest rates, people still prefer home equity loans in Thunder Bay because they are more flexible than those that are given by banking institutions.
Custom Choices Include:
You can have our officers write more options in the agreement by disclosing your situation. This is the only way to ensure that you receive a product that is perfectly tailored to you.
How Much Can You Borrow With a Home Equity Loan
The amount you get depends on the value of your property and all the debts in it. This is known as equity and to make sure that it is worthy of a loan, lenders must calculate loan to value ratio. This metric is obtained by dividing the value of all debts by the current price of property in the hopes of getting 85% or less. Any value above 85% LTV is above the maximum upon which our loan equity lenders in Thunder Bay can risk. While it is the most important factor, some lenders consider credit score and employment alongside LTV in order to approve loan applications.
A borrower knows how best to use their loan money which is why home equity lenders leave them to decide on the best uses. Having worked with Thunder Bay residents for many years our loan officers are privy to some common uses of equity loans. The most prominent uses are business investing, education, debt and college fees payment. Some people also use their home equity loan in Thunder Bay to pay for vacations and expensive cars.
The loans we provide in Thunder Bay can be used in any way that meets your needs. It could be for less common uses like stopping foreclosure, helping loved ones or even handling emergency bills.
A home equity loan is a kind of installment loan which means that terms and conditions of payments are non-negotiable. The home equity line of credit (HELOC) is a type of credit with dynamic rates and terms. This means that interest rates for one month might be lower than the last to match your revenue. This flexibility extends to the fact that an HELOC can be accessed at any time the borrower needs it. For a home equity loan, the rules are more stringent as after the first chunk of money, you have to wait for a new contract before getting additional money. Despite stark differences between a home equity loan and home equity line of credit, many people still think they are related. This might be because both are approved based on LTV of the property presented as security.