If you’re a homeowner, you work hard to pay for your home. Maybe it’s time to put your home to work for you as many have with Home Equity Loans—also termed second mortgages. Home improvements, special vacation, new vehicle, whatever you are looking for, your home equity can help provide it!
What Are Home Equity Loans?
Home Equity (HE) Loans allow you, the homeowner, to access cash or credit based on the current market value of the house minus any mortgage payments due. Equity accumulates over time as that mortgage is paid, and the property value itself simultaneously appreciates. Homeowners can tap equity in two ways: via HE Loans, and/or HE Lines of Credit (LoC).
Home Equity Loans vs Lines of Credit (LoC) At Pinnacle FCU
At Pinnacle, we make available to qualifying member borrowers both HE Loans and HE LoC of up to $200,000, all tax-deductible. Terms can range up to 20 years and at interest rates more attractive than credit card companies charge. LoCs work just like a credit card—the borrower makes purchases against credit equal to the amount of home equity, but at a variable rate of interest. HE Loans provide lump sums, rather than credit, for a slightly higher, but fixed interest rate. Note that, while each presents with different opportunities and risks, either must be paid in full if the house that backs the loan is sold before its terms are met.
Which Second Mortgage Works Best For You?
Homeowners reap benefits with home equity loans, whichever route they choose. Principal among those plusses are the low interest rates we offer—as low as 3.50% APR*—compared to the average 2016 credit card purchase interest rates (APR). Depending on credit score, APRs as reported this year range from a low of 13.99% to 22.62% for some purchasers.
How are they different? HE LoCs work like credit cards, and only charge interest when they’re used; when unused, a LoC simply grows with equity. LoCs can serve as great emergency plans for unforeseen home repairs. They can however also be adjusted or even cancelled while active, with prior notice to member borrowers. HE Loans, with their fixed interest rates, offer a counter of stability over the life of the loan that some borrowers prefer—once disbursed, the amount to repay and the terms thereof are also fixed.
Home Equity Loans in Edison and Middlesex County, NJ
If you’re in or near Edison, NJ and are ready to put your home equity to work for you, contact Pinnacle FCU and become a member today. We’ll help you find the right loan for you at the best rates around!