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We've simplified the process to help you access up to 95% of the equity in your home.
What is a Home Equity Line of Credit?
A home equity line of credit (HELOC), is a line of credit that is secured by the equity in your home. Similar to credit cards, HELOCs consist of revolving credit lines that allow you as the borrower to continue to access your available credit line after you’ve made payments towards your outstanding balance. Borrowers are given a draw period which is the period of time that the borrower can access funds from the available credit line. After the draw period ends, the borrower is no longer given access to withdraw funds from the line of credit and the repayment period begins. HELOC loan terms are flexible and include variable and fixed rate options. Given that the equity in your home is used as collateral, a HELOC can provide the benefit of receiving a lower interest rate than other loan products. Depending on your situation, the interest paid on HELOC’s may also be tax deductible. A consultation with your tax advisor is recommended.
In order to qualify for a HELOC, the amount you owe own your mortgage must be fairly lower than the estimated value of your home. The difference between these two factors is used to determine the equity which is used as collateral for the line of credit. With Modern Lending, you can access up to 95% of your home’s equity. For example, if your home has $100k in equity, you can access up to $95k. In order to qualify, your credit score, credit history, monthly income, and debt-to-income ratio are taken into consideration along with your loan application.
With interest rates continuing to increase, a HELOC allows you to access your home’s equity without significantly increasing your mortgage rate.
A HELOC also provides the benefit of:
Accessing up to 95% of your home’s equity
Getting the cash you need - up to $500,000
Choosing from flexible terms - 5 to 30 years
Saving with 10 years of Interest-only payments
Enjoying a faster, easier digital process
Relying on expert guidance and help
Using your equity to help pay for home improvements or any large personal expenses
Price of Home Purchased in 2019: $650,000
Current Appraised Value: $875,000
Current Mortgage Balance at an interest rate of 2.99%: $535,000
Total Equity Available: $340,000
HELOC at 80% of the home's value: $165,000 Line of Credit
Line of Credit Terms: 30-Year Loan at PRIME + .1.49% Rate
Purpose of HELOC: Customer will be using this amount for a down payment on a $560,000 AirBnB property in Nashville, TN
Home Equity Lines of Credit can offer the best terms to use your home’s equity to pay for expenses or reinvest for your future. To find out what types of financing you would qualify for click the link below or call us at 844-4MODERN today!
