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Loans UK - US - Canada |
Home or
equity loans are similar to a mortgage, but the lender grants the borrower
more flexibility and freedom to use the money as they wish. A borrowed
cash lump sum can be issued for just about any purpose; you might want
to buy a new car, or pay for much-needed home improvements. Maybe you
and your family wish to take a dream holiday in the sunshine, or you simply
wish to make life that little bit more pleasant. Whatever your needs,
it prove to be a suitable finance solution for homeowners.
Let’s assume for instance that you are repaying a mortgage of £100,000.
You have paid off half of this amount, so your current mortgage balance
stands at £50,000. If you now apply for an equity loan, you will
be entitled to a sum equalling the difference between your current outstanding
mortgage balance, and a certain percentage of the value of your home or
property (usually 70-80%). There are generally few restrictions on what
the deal may be used for; it is a flexible, low-interest way to finance
major expenses. In some cases it is also tax deductible.
Equity lending is attractive to borrowers because they have the ability
to borrow money with relatively little cost up front, and at a lower rate
of interest than they would normally pay. The government issued rules
concerning such deals which are quite significant, and can be of great
benefit to the borrower: |
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