The following is a sponsored post. All opinions are 100% my own.
In the past 5 years, homes have greatly escalated in price. If you happen to own a home already, this is great news for you.
According to Zillow, the average home in the United States is valued at 25% more than when they first bought it.
That would mean a home that was valued at $158,000 would potentially end up being worth $198,000.
If you are a homeowner with good credit and have also built up equity, you may be in the position of an opportunity for low-interest borrowing.
With a home equity loan, you have the option of doing the following things:
Debt that comes from medical bills, student loans, and credit cards can be consolidated to assist you in paying off debt quicker. By decreasing the amount of debt you have, you're simultaneously increasing your financial security, net worth, and potentially may even increase your credit score.
By doing all of these things, you are helping yourself in case you want to borrow money in the future.
When a person consolidates their high-interest debt with a HELOC, they are potentially decreasing their monthly dues which can lead to saving a lot of money that would be paid in interest every year.
You need to first ensure you are maximizing the money obtainable, while also figuring out how you'll access the money. You can do this by either a HEL (home equity loan) or a HELOC (home equity line of credit).
A home equity loan will give the homeowner an one-time payment, while a home equity line of credit is a line of credit that will remain available for a span of time, while also being used similarly to a credit card.
With a HELOC, interest rates are usually lower in cost since the home is used as a security or collateral for the debt acquired. So, depending on how much money you end up using, that'll be a determining factor on how much you will pay in interest.
A home equity loan of credit will give a homeowner more flexibility and has a wide span of benefits that go long-term. The homeowner has access to the money without needing to spend it all at once. This is a big benefit to a home equity loan of credit compared to a home equity loan.
A major benefit of choosing a home equity line of credit is knowing that the interest is tax deductible.
Many American may be sitting on piles of cash and have no clue about it. With home values and other homes in your neighborhood increasing, your home becomes more valuable in price, which lets the bank allow you to borrow according to the “new appraised value of the house”.
This is especially important if you are looking to save money (which who isn't?).
With the money from your home equity loan, you can start a renovation on your house, pay for your child's first car or study abroad program, or even simply pay off some credit card debt.
With LendingTree, you can learn more about a home equity loan, as well as several other things such as refinancing your home or student loans, and many other things.
How to Access Your Cash
Whichever decision you make, you don't have to do it alone. You can use LendingTree's free and easy system to figure out your loan options and see which is best depending on your financial goals.
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