HOW TO DETERMINE YOUR EQUITY

The easiest way to find out how much equity you have in your home is to subtract the amount of your mortgage balance (look on your mortgage statement for UPB, Unpaid Principle Balance, or just Principle Balance) from the current value of your home.  For example, if your home is worth $100,000 and you owe $40,000, then your equity is $60,000.  In other words, as you pay down the principle on your mortgage, your equity increases inversely.

HOW DOES EQUITY WORK FOR YOU?

What makes equity special?  Well, equity can actually work for you if you know how to do it.  Many people borrow against it and use the money they take out to pay for things such as home improvements, investments, or even paying for a child’s college tuition.  Other people use the money to purchase additional properties and, in turn, make even more money.  Nice.

Long story short, having a lot of equity in your property is a great thing, especially if you are all of a sudden in the need for cash.  But how do you actually get the money out to pay for things?  Well, that’s where the HELOC comes into play.

HOW DOES A HELOC WORK?

Opening a HELOC (which stands for Home Equity Line of Credit) allows you to access the built up equity in your house for when you need a quick influx of cash (without having to refinance your entire mortgage).  Let’s say you fall and break your arm, or your daughter needs braces.  Or maybe your car broke down and you need a few thousand dollars to pay for repairs.  A HELOC can give you the cash you want (your cash) to pay for the things that NEED to be paid.

The HELOC you take out functions basically like a second mortgage on your home.  Because of this, the interest rate you pay will be a little higher than that of your first mortgage.  This is common, being that second mortgages are traditionally more risky from the point of view of the lender.  Different factors can determine how much interest you pay, though.  Quite simply, the rate you get is also mostly determined by the amount of equity you are cashing out.  The more equity you take out, the higher your interest rate, and vice versa.

A LITTLE MORE INFO

Fortunately for you, there are quite a few different types of HELOCS available to you as a consumer and homeowner.  Just like a traditional first mortgage, you can get a HELOC with a fixed or an adjustable rate.  You can do it as a regular line of credit, or you can take out the entire amount in a lump sum.  You can also do a bit of both.  You can write checks from the HELOC (like a bank account) and some lenders will even grant you a debit or ATM card to use to make withdrawals too.  You’ve got lots of options is what I’m saying.

In conclusion, whatever your particular needs may be, there is more than likely a HELOC out there for you.  They can really help out in times of need, and the more people that are educated on their benefits the better.

If you would like to see if you qualify for a Home Equity Line of Credit, don’t hesitate to CONTACT US and we will get back to you as soon as possible.  You can also FILL OUT THIS FORM and one of our loan officers will review your situation to see if a HELOC is right for you.  Just tell us a little bit about yourself in the comments section

Here at DFW Mortgage Guide we have numerous loan programs that can be custom-built to fit your situation, whatever it may be. We serve the Dallas Fort Worth area metroplex exclusively, so you know you are dealing with a company that knows the area.

We also work with over 20 lenders and have access to almost any loan program available.  These include:

PERMANENT FINANCING MORTGAGES
We offer a multitude of Mortgage programs for Dallas Fort Worth including conventional fixed rate mortgages, FHA Loans, VA, Jumbo, ARM’s, USDA, Interest Only, investment properties, condominiums, and many more!

HOME IMPROVEMENT MORTGAGES
Whether you are looking to purchase a home that needs improvements, or if you need to do some work on your existing house, we have options available for first and second lien home improvement mortgages.

HOME EQUITY MORTGAGES
We offer Cash-Out Mortgages for primary homes, second homes, and investment homes, as well as interest only HELOCs for primary residencies.

SECOND LIEN MORTGAGES
We also offer stand alone second mortgages and second lien mortgages closed concurring with first lien mortgages.

REFINANCE EXISTING MORTGAGES - If your existing mortgage payment is too high, it may be time for you to refinance.  Interest rates are at all time lows right now, and it is worth taking advantage of if you live in Dallas Fort Worth and want to lower your monthly bill!

FURTHERMORE, we strive every single day to be the absolute best mortgage company in Dallas Fort Worth.  We accomplish this by offering competitive costs, while also providing you a level of customer service that is unmatched.  Please call us at 817-527-3164 to prequalify for FREE and we will happily discuss your situation.  Even if you can’t get a home loan right away we will do everything we can to make sure you can get one in the future.

If you are ready to begin your home search, or if you have any questions about financing, don’t hesitate to CONTACT US and we will get back to you as soon as possible!