In previous episodes of our series on tapping into your home's equity, we discussed doing traditional FHA, VA, and conventional loans, as well as home equity lines of credit (HELOC). Today I'll share the third way to turn your home into a financial resource: home equity loans.
Home equity loans are mostly for people who can't really show income, are planning/expanding/creating a business, or have bad credit. So why are they good loans?
For one, home equity loans let you use up to 65% of your home's equity with minimal documentation. To calculate 65% of your equity is simple: Just multiply the value of your property by 0.65% and subtract that by how much you still owe on it. Let's say your property is worth $1 million and you still owe $200,000 on it. With this loan, you can cash out up to 65% of your equity, which is $450,000!
However, you should seek professional advice to help you analyze your situation and determine whether it makes sense for you to get a home equity loan. If you're curious about how much equity potential your home currently has or you'd like to discuss these loans in more detail, give us a call or shoot us a message. We'd love to help you.