Home equity loans describe a type of installment loan lent to properties with enough equity. Equity is the value of a home, less its mortgages. They are much different from bank mortgages, which are offered according to a borrower’s credit and employment history. Home equity lenders rely on equity as it helps them accurately assess the risks of lending to a particular property. Our experienced team has been providing home equity loans in St. Thomas for many years now.
Rates and Terms of a Home Equity Loan
This is a first or second mortgage offered at 7%-15% interest with the option to end in one year or less. If you decide to use the open clause and repay the loan in full before the deadline, there is a penalty. Three months interest is demanded as a fine for ending the loan early. Despite rather tough terms and conditions, clients are still attracted to home equity loans, perhaps for their flexibility. By closely listening to your needs, our loan experts are able to customize home equity loans in St.Thomas to your needs.
Customized Home Equity Loans
- Blanket Mortgage: If you own several properties, it is possible to use them all as security so you can secure more funding.
- Interest Only Mortgage: For this loan, only the interest payments are required and the principal remains untouched.
- Construction Draw Mortgage: This is a loan product where we pay your contractors until your building project is complete.
Our experts appreciate unique circumstances faced by individuals and are always willing to include any special demands in the loan agreement. The result is a customized loan that can indeed be used to actualize important goals.
How much are you Eligible for with this Loan
The amount disbursed depends on how much equity there still is on your property. By dividing debts by the price, lenders obtain the loan to value (LTV)as a guiding factor for home equity loans approval. Our home equity lenders in St. Thomas are ready to extend loans to the property with up to 85%LTV but not any value above that. Substantial equity must be presented as it shows a lender that there is a chance for them to recoup the investment in case you default on a loan. The home equity loans in this St. Thomas are reasonable amounts with several uses.
General Purposes of Home Equity Loans in St.Thomas
Home equity loans are commonly taken by people in need of large amounts of money to meet various obligations. Our lenders have encountered varied reasons for needing the home equity loan but most popular are; home renovations, business investing, education and debt consolidation to name but a few. On a less urgent level, some people only need the loan to make care payments or purchase an expensive vacation package.
- Education: You can rely on the loan money to pay college fees for yourself or your children.
- Debt consolidation: People dogged by numerous high-interest debts every month find relief in a home equity loan, which clears the loans and leaves them with a less expensive, more manageable debt to handle.
- Business Investing: Instead of complaining that you lack the capital to start a business, you best take a home equity loan and inject the money into your venture.
It is impossible to outline all uses of a home equity loan but you have the freedom to do as you wish with the loan. Unlike banks who might discredit your application over the reason for needing a loan, home equity lenders are lenient and ready to accept any reason. The only catch is that you pay this loan to avoid losing your credit score and valued property.
Disparities Between a Home Equity Loan and the Home Equity Line of Credit
Differences begin with the fact that a home equity loan is paid in fixed installments while the home equity loans rates vary. Once approved, you can withdraw the HELOC at any time but remember to stay within the credit limit. The only reason why so many people mistake an HELOC for a home equity loan and vice versa is that both are approved based on the LTV of a property presented as loan security.