As a Mobile Notary and Loan Signing Agent, I come across many types of loans. This blog is written to inform readers about a type of loan known as a Home Equity Line of Credit (HELOC).
A person is able to access the equity in their home and borrow against it. This is done as a line of credit. The lender agrees to lend a maximum amount within an agreed upon period of time. There is a date when the HELOC balance must be paid off.
As you repay your outstanding balance, the amount of available credit is replenished much like a credit card. HELOCs can be interest only through the years of the loan term that the borrower can draw on the line of credit.
HELOCs are convenient for funding intermittent needs, such as paying off credit cards, making home improvements, or paying for college tuition.
Upfront costs are also relatively low. On a $150,000 standard loan, settlement costs may range from $ 2000-$5,000, unless the borrower pays an interest rate high enough for the lender to pay some or all of it. On a $150,000 HELOC, costs seldom exceed $1,000 and in many cases are paid by the lender without a rate adjustment.
Some HELOCs are convertible into fixed-rate loans at the time of a drawing. This is a useful option for borrowers who draw a large amount at one time.
Whatever your Mobile Notary and Loan Signing needs, I am happy to travel to you!