and is it really tax deductable
2007-02-21 14:37:04 · 6 answers · asked by rags91744 2 in Business & Finance ➔ Personal Finance
Yes, it is tax deductible under the same guidelines as your mortgage.
A home equity loan is normally preferable to refinancing, as most institutions don't charge any closing costs and underwriting is much quicker. A line of credit is more flexible than the loan, but is usually a revolving interest rate that actually results in more interest paid, even though the interest rate may be stated as lower. In some cases, you can get both, which allows you to get a simple interest loan for the amount you know you'll need, and a line for unforeseen expense.
Do not apply at multiple institutions. This may result in unnecessarily impacting your credit score and causing less attractive terms. Contact a local mortgage broker who can shop the market for you using a single credit report. Often, lenders will offer lower rates through brokers than they offer directly.
2007-02-21 14:57:55 · answer #1 · answered by Rob D 5 · 0⤊ 1⤋
Home equity is the difference between what you owe and current appraised value. Depending on your credit score you may be able to borrow up to 125% of your homes value. There is a fixed amount 2nd mortgage. You get a fixed amount when you take out loan. Usually at a fixed rate. Then there is the equity line of credit. Where you are approved up to certain amount. Then you write checks up to that amount. These loans typically are adjustable rate and part you borrow may become fixed at the time you write check.
Interest and maybe some closing cost can be tax deductible. Ask your CPA / tax preparer. Don't ask loan officer. A lot of them don't know and/or will tell you what you want to hear to close the loan deal.
2007-02-21 15:04:32 · answer #2 · answered by Gunny Bill 3 · 1⤊ 1⤋
gunny bill is correct the best way to find out if the interest is tax deductible. or not is to Ask your CPA / tax preparer. I have been in the Mtg industry for 2 yrs and I also own a home and did not have enough deductions to claim any of the interest on my house. The best they can legally say to you is that it is potentially deductible...The money from your home equity loan can be used for anything you want, it doesn't have to be to repair the house...it is your to use how you need to use it.
2007-02-21 15:29:34 · answer #3 · answered by Annie 2 · 0⤊ 0⤋
You use the equity you have in your home for the collateral for the loan.
The equity is that portion of the home's value that you have paid off either through payments or increased market value.
It is deductible for certain things, check with a loan officer.
2007-02-21 14:43:00 · answer #4 · answered by The Parthian 3 · 0⤊ 0⤋
If there is not any loan on the residing house - you won't be able to take the two one. you may could finance the residing house on your call this implies 1000's of remaining costs ^ an high priced thank you to get a private loan
2016-11-24 23:09:03 · answer #5 · answered by ? 4 · 0⤊ 0⤋
home equity is the value difference between what you owe on the house to what the value is right now..ex. 100.000 owe, value 150.000...you`ve got 50k to "play" with. Take 50.000 or 25.000 or 35.000 and put them into your house remodel your kitchen or bathroom etc. and you`ll get back double or triple! DON`T USE YOUR EQUITY FOR VACATION OR CAR OR BLINK,BLINK!!!!!!!!!!!!!!!!!!!!!
2007-02-21 14:51:24 · answer #6 · answered by acmilan 2 · 0⤊ 0⤋