A home equity loan is a loan that home owners can get based on the amount of equity they have built up on their homes. The homes are used as collateral to secure the loan for the borrower. Typically, the lender will look at how much your house is worth and how much you have paid on it so far and will then figure out a percentage based on those two numbers that will determine the amount of money you are eligible to borrow. Typically these come in two forms: the fixed rate and the adjustable rate. People who take out a loan on all of the equity they have built up are said to be taking out a 100% home equity loan.
This type of loan is not something that should be entered into lightly. Chances are that this type of loan will be worth quite a large sum of money and borrowing large sums of money comes with large risks, the biggest being that if you default, you will lose your home.
If you are thinking about getting a 100% home equity loan you will want to talk to as many lenders as possible before deciding on the one you will work with. Different lenders will promise you different rates, deals and repayment plans. Do your research and ask each lender for references. Talk to others who have taken out similar loans and see what their experiences have been. One hundred percent loans are risky. After all, you will have to pay the money back so you could end up paying 200% of what your home is actually worth.
Something else you will want to really think about is if you actually need to take out this type of loan. What are you going to be using the money for? Debt consolidation? Home repairs? Are there other ways to pay for these things? You want to weigh all of your options before signing the loan papers.
By Max Suther
Get more information about 100% home equity loans at http://www.100homeequity.com where you will find articles, tips and info on cits home equity loans.
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