Is there a difference between a Home equity loan & Home equity line of credit?

Answer 1

The loan is when you actually borrow a specific amount of money. The line of credit is when they set you up to draw out money up to a certain limit. In the second case, you may not actually draw on the line of credit. The end result is the same if you spend the same amount of money.

Answer 2

Usually with a home equity loan you get all of the money for your loan transfered to your bank account. Then you start paying monthly payments on the sum.

A home equity line of credit is more like a debit card where you only have to make payments based on what you've used.

Answer 3

Loan is a lump sum where a check is issued to you for that amount. A line of credit is like a credit card with a limit.

Personally, I prefer the line of credit. That way you can maximize the amount you "may" want, but only pay for what you use.

You might be able to deduct the interest for both on your income taxes. Check your state laws to be sure.

Answer 4

i love the hostility in the direction of the inner most loan marketplace LOL hi, i'm a qualified mortgage planner. A refinance mortgage is once you refinance the first (and once you've one a 2d lien) right into a sparkling mortgage. I even ought as an instance something stated as benefit to the Borrower to do one. IE, lowering interest cost, going from ARM to fixed cost mortgage, lowering ordinary funds etc. the regulations to refinancing have replaced contained in the most suitable 6 months, extensively. the significant reason to refinance at present's when you're in a ARM and would flow to a not ordinary and quickly cost mortgage, the expenses are very similar at present. yet i could not say no matter if or not they'll stay that way. living house fairness mortgage is a 2d lien on the resources. On call it comes after your first. I have in no way considered an ARM in this way of. they're usually fixed for a time period of 15-two decades, each in certain situations 30. living house fairness Line of credit is obtained from a monetary employer. it really is a line of credit which will be a not ordinary and quickly or adjustable cost. As you pay own the line, you've get admission to to it back. it really is almost like a mastercard, even with the undeniable fact that the collateral is your position and in case you do not pay it the consequences are wide. they're usually available to you for a particular time ie., 10, 15 or two decades. once you've extra questions, please be at liberty to the contact me. As a CMP my objective is to be a source and equipment for persons. good success.

Answer 5

Yes... the loan is the amount you presently owe to the bank and the line is the available that you may receive