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A Home Equity Loan: Is it
right for you?
If you own your home, it’s probably your greatest
asset. Be very careful about taking out a home equity loan.
If you fall behind in the payments, you could lose your home.
What is equity? Home equity is the difference between
the balance of your loan and the market value of your home.
So if you owe $50,000 on your home, but it’s valued at
$80,000, you have $30,000 in equity. You can borrow against
this equity. In essence, you are using your home for collateral.
This document has four sections:
| Section 1: |
Home equity loans: pros and cons. Why you might
get a home equity loan and some of the pitfalls. |
| Section 2: |
Shop, shop, shop, and read the fine print. How
to make a good decision on a loan based on the facts. |
| Section 3: |
Look out for deceptive practices. Predatory and
deceptive practices you might encounter, whether you’re
shopping for a home equity loan or not. |
| Section 4: |
Protecting yourself against unscrupulous lenders.
Good advice before signing on the dotted line. |
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