Home equity loans are a type of debt secured by a piece of real estate. Home equity lenders are ready to overlook the client’s credit score in making a decision on which application to approve. They give people a second chance at utilizing personal assets for financial gain. We have an experienced team of loan officers who have been issuing home equity loans in Pelham and other Ontario cities for many years.
What are the Terms and Conditions for a Home Equity Loan
This is a standard open first or second mortgage on your property that you must repay in 12 months. You get the loan at 7%-15% interest and as an open mortgage, you may choose to pay early. This decision goes with a fine of three months interest fees. To protect their interests, home equity lenders provide registered mortgages which allow them to sell homes in default.
Terms of payment are quite tough but people are still attracted to home equity loans which can be customized. Our home equity lenders are ready to discuss your circumstances and recommend the best alternatives for you.
Common Tailored Home Equity Loans in Pelham
- Blanket Mortgage: Our company allows you to use multiple homes as loan security. This is ideal for people looking to secure large amounts of money.
- Interest Only Mortgage: You only need to pay interest as principal remains the same.
- Construction Draw Mortgage: We pay your contractors to ensure completion of your building project.
People have diverse needs and our officers are pleased to include them in your loan agreement.
How Much Can I Get with a Home Equity Loan
The exact amount you get with this loan depends on equity in a property. The value of a home and cumulative debts on it help the home equity lender in calculating a metric called LTV. It is obtained by dividing the value of debts on a property by its market price. In so doing, they hope to get 85% property LTV, the maximum to which they can loan. Creditors must avoid properties with a heavy debt burden because even with a registered mortgage, they might not recoup. The mortgage act indicates that other lenders who came before must be repaid before a home equity lender may claim their investment.
The home equity loans we give in Pelham are reasonable amounts that can help in making significant financial strides.
How to Use the Money
Our home equity lenders have seen many uses for the money with some being more important than others. Most clients need the money to pay for education, as capital for a business, or to meet daily expenses. Our lenders accept any explanation you give as according to them, you know your priorities best. This is different from banks that often reject loan applications due to the reasons that were given for needing them. As long as there is enough equity, a lender will extend the loan knowing that they can be compensated from the sale of a property
- Debt Consolidation: Money can be used to repay other expensive loans. This leaves you with a single debt that you can afford.
- Business Investing: Home equity loans often suffice as capital for a business.
- Education: You can send your kid’s to school using this loan as school fees.
- Renovation: The money may be invested in home upgrades and repairs.
Our loans have less common uses like stopping a power of sale, helping family members and even paying for emergency medical treatment.
Comparisons Between Home Equity Loans and Home Equity Lines of Credit
A home equity loan is a type of installment loan unlike a home equity line of credit with dynamic interest rates. You can access the HELOC at any time it is needed but you must be aware of the credit limit. A home equity loan is extended with fixed monthly rates for a set period of time. Both loans are approved according to equity in a property, which is probably the reason why people confuse them. Our loan officers will certainly help you decide on the best options for a home equity loan to serve your needs.