Equity lenders base the loans on the value of the home. If the homeowner purchased a home several years ago, paid x amount of mortgage repayments, then the lender will deduct this equity amount from the value of the home. Thus, the lender will consider the amount paid, plus the amount of mortgage owed, current equity of the home, and then subtract the amount owed before considering lending the money to the borrower.
If the home was purchased at market price for $200,000 and currently the home is worth $400,000 due to an increase in the home value on the market, then the lender may consider lending the homeowner the amount of the loan to be paid off. The house is paid in full on the first mortgage; however, the homeowner is now paying a second loan for the amount he owed in the first place, plus the fees and costs, and interest rates.
Equity loans then are loans taken out on a home to repay a pending debt on a home. The loans are giving to clients utilizing the home as equity as a guarantee that the homeowner will repay the debt. Some equity loans extend loans up to 30-years, while other loans last only 15-years.
It depends on the lender, but in most...
To view and download this full PLR article, you must be logged in. Registration is completely free. Once you create your account, you will be able to browse, search & downlod from our PLR articles database of over "1,57,897+" on 1,000's of niches and 200+ categories without paying a penny. Click here to signup...
