Do you need to free up funds to pay for a larger expense or consolidate debt? With Greater Nevada Mortgage, you can leverage your home’s equity (what your home is worth minus what you still owe) to access a Home Equity Line of Credit (HELOC) that you can tap into whenever needed, a lump sum funding through a Home Equity Loan, or explore options for a Cash Out Refinance.
Home Equity
Limited-Time Offer: Interest Rate Discount on a New HELOC!
You can lock in a lower rate depending on how much you borrow at account opening.
What is Home Equity, and How Can You Use it?
So, what is home equity, after all? It’s a fairly simple concept that refers to the current market value of your home, minus what you owe. For example, if you had a loan on a $500,000 home and you have already paid $200,000 on it, and assuming your home’s value stayed the same, then the amount of equity you have would be $200,000. Your equity may grow over time as you continue to make payments against your home loan and the value of your home increases or decreases. Any gains you make come from paying down the balance of your loan over time or as the home’s value increases.
4 Ways to Leverage Your Home Equity
Home equity can be used for everything from home renovations to grad school and other personal expenses. Here are several common uses.
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1. Home Improvements
One of the most popular reasons to take out home equity on your property is to make improvements to your home. Looking to remodel your kitchen? Adding a “catio” for your furry friends? Whatever improvements you want to make, home equity is an excellent funding source to do so.
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2. Debt Consolidation
If you’re facing the prospect of paying off large sums of debt, there may be a better way. Tapping into your home equity to repay outstanding debt can be an efficient and lower cost method of ridding yourself of credit card and other high-interest debt balances.
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3. Education
Career changes can be a terrific way to increase your household income and maximize your potential. If you’re considering going back to school to learn new skills, home equity can be used to fund your studies.
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4. Emergency Expenses
Life happens. Be it a medical emergency or the need to fly across the country to take care of a loved one, it’s always prudent to have funds available to deal with all the curveballs life can throw. Home equity can help.
Options for Borrowing Against Home Equity
Homeowners have a whole array of options when it comes to equity-based home loans.
Home Equity Line of Credit (HELOC)
If you’d like the flexibility to tap into funds when needed, and only pay when you use them, then a HELOC may be just what you’re looking for.
Home Equity Line of Credit
Home Equity Loan
A Home Equity Loan is an excellent option for securing a fixed rate and consistent monthly payments on a second mortgage.
Home Equity Loan
Cash Out Refinance
A Cash Out Refinance allows homeowners to refinance their first mortgage to a higher amount based on the amount of equity available.
Mortgage Refinance
How Do You Pull Equity Out of Your House?
Greater Nevada Mortgage has a solution for all stages of home ownership. For many, that means leveraging equity in their homes to successfully finance their dreams. Here’s how to get started.
Get in Touch
While it may not be needed by everyone, our leading professionals are happy to offer a no-obligation consultation to help answer any initial questions you have.
Complete an Application
Fill out an online application with pertinent information such as income, expenses, savings and assets.
Loan Process Begins
Your lending professional will reach out to you with next steps toward funding your dreams.
Common Questions About Home Equity
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What is the difference between a Home Equity Line of Credit, Home Equity Loan, and Cash Out Refinance?
Homeowners often hear about Home Equity Loans, Home Equity Lines of Credit (HELOC), and Cash Out Refinances when exploring ways to tap into their home’s value. While they all let you use your home equity, each one works a little differently.
A Home Equity Loan is a lump sum funding method built around a fixed rate, fixed term, and fixed payment amount. With this type of loan, you’ll begin making payments immediately, and your first mortgage’s monthly payment remains unchanged. It’s important to note that a home equity loan is considered a second mortgage and adds a second monthly payment independent from the first.
A HELOC, on the other hand, is an adjustable rate line of credit tied to the prime interest rate and may include an additional margin. Whenever the prime rate changes, your HELOC payment may also change. However, with a HELOC, you take out money as needed, and only make payments on the outstanding balance. In other words, if you don’t have a balance, you won’t be making payments.
A Cash Out Refinance replaces your existing mortgage with a new, larger one. You receive the difference between the two loan amounts in cash to use for whatever you’d like. Because it becomes your new first mortgage, you’ll continue to have only one monthly payment at a new interest rate and term, which may be higher or lower than your original mortgage, depending on current market rates.
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How much equity do I have in my home?
It’s pretty easy to figure out your home’s equity. Get an estimate of your home’s value (from websites such as Redfin and Zillow) and subtract the amount left on your mortgage. To increase the equity in your home, follow these steps:
- Make a large down payment when purchasing
- Focus on paying off your mortgage faster than the repayment schedule
- Consistently pay more than the minimum
- Renovate as needed to increase your home’s value
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Is it a good idea to use home equity?
Homeowners find significant benefits in being able to tap into their home equity to fund various expenses. From college and postgraduate education to home renovations and emergency funds, utilizing home equity can be an affordable way for many people to access money.
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Does using home equity hurt your credit?
Any time you borrow money, it will impact your credit score. When you first apply, our team does what we call a “hard pull” on your credit to ensure that you can repay over time. This may or may not impact your credit score depending on many other factors within your credit history.
Increasing your total amount of debt can also impact your credit score.