Home Equity Loan: How it Works and Requirements
A home equity loan is a type of consumer debt also known as a home equity loan, home equity installment loan, or second mortgage. Home equity loans allow homeowners to borrow the value of their homes. The amount of the loan is determined by the difference between the current market value of the home and the balance of the homeowner’s mortgage. Home equity loans are usually fixed rates, while home equity lines of credit (HELOCs) are usually variable rates.