home equity line of credit (heloc)
|
Martin can help you determine how much equity may be available to you through a Home Equity Line Of Credit, or HELOC. A HECOC is a revolving line of credit secured by your home at a much lower interest rate than a traditional line of credit. Martin can get a HELOC for up to 85% of your home’s value.
HELOC funds are available through a revolving line of credit where the entire credit is available but not advanced upfront. Instead, you can use as much or as little of the HELOC as you choose, and you only pay interest on the amount you withdraw. |
|
Interest is calculated daily at a variable rate attached to Prime. HELOC rates are traditionally higher than a variable mortgage rate but, unlike a variable mortgage rate, its relationship to Prime does not always stay the same. You will need to make a monthly payment for any outstanding amounts you have accessed in the same way a traditional line of credit works. You only need to pay the interest on your outstanding balance and that amount is automatically taken out of your bank account on the same day each month.
|
|
Obviously, you can make more than interest only payment to reduce the balance or pay it in full. And, unlike a refinance, you do not need to break your existing mortgage when considering a HELOC. Therefore, you won’t need to pay a mortgage penalty. What you do with your HELOC funds is entirely up to your discretion.