If you need cash to tackle home renovations like a kitchen remodel or a new roof, a home equity loan or home equity line of credit (HELOC) might be your answer.
These loans let you borrow money using the equity in your home as collateral. Unlike almost any other consumer loan type, the interest on a home equity loan or HELOC of $100,000 or less is actually likely to be tax-deductible ($50,000 if married filing separately).
With a home equity loan, you borrow a lump sum of money repayable over a fixed term, usually five to 15 years, giving you the security of a locked-in rate and a consistent monthly payment. These loans are similar to a mortgage, since your rate and payment won't change throughout the life of the loan.
A HELOC is much like a credit card or any other type of open-ended credit. You can borrow money as needed (up to the credit limit your loan officer assigns) using a special checkbook or credit card or by making a transfer into your checking account. A HELOC is usually a variable-rate loan, so your monthly payments will change based on your outstanding balance and fluctuations in the prime rate.
Which option is best for you can depend on a lot of different factors—so talk to a Sun Federal loan officer today for more details about our home equity loan products! Stop by your local branch or call 800.786.0945 to start your conversation today.