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Benefits And Forms Of The Home Equity Line Of Credit

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Many consumers have welcomed the ever-increasing trend of an Equity Line of Credit as one of their primary credit options. An equity line of credit allows you to use the existing value contained within your property to access additional funds via a lender. In addition to allowing you the freedom to take control of your financial future, an Equity Line of Credit creates refinancing possibilities that you may have never thought possible.

One of the most popular forms of an Equity Line of Credit is a Home Equity Line of Credit. If you own a home, you have available credit contained within these walls. This credit allows you the opportunity to make improvements to your surrounding, buy the boat or R.V. you always wished for, or solidify your …show more content…

Many lenders, due to the competitive nature of the money market, offer low introductory rates that give the consumer many choices during the beginning of their loaning period. This allows the consumer to either ease into their payments, or pay off their initial purchases at a fraction of the cost they would be paying with an exorbitant credit card. And, unlike a credit card, which can drag you into a lifetime of debt, an Equity Line of Credit is established only for pre-determined period--you get the money when you need it, and when the loan has run its course and served its purpose it is paid and done. No years of dragged out finance charges, just concise effective financing. The APR for your line of credit can be either a fixed rate or variable rate, depending on what you and your lender see fit for your situation. Variable rates will always be published and immediately available for reference.

The Benefits of an Equity Line of Credit are usually compared to the benefits of a Second Mortgage. The Second Mortgage is an available option with different parameters. A Second Mortgage is a predetermined amount of money available to the lender that must be paid in fixed increments, at fixed points in time. When compared with the Equity Line of Credit, it does not allow the personalization characteristics, but it does provide a little more stability. The Second Mortgage is just a second option for a consumer who wants to maximize there available financing.

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