Home equity loans for making home improvements, also known as home improvement loans, are second mortgages that come in two forms:
- A home equity installment loan involving a lump sum loan. These loans are typically fixed-rate loans, but adjustable-rate and interest-only loans are also available. Borrowers make immediate principal and interest payments on the full loan amount.
- A home equity line of credit (HELOC) that works like a credit card during the initial draw period of typically 5 to 10 years allowing borrowers to draw repeatedly without applying for a new loan. These are variable-rate loans with the interest consisting of an adjustable rate tied to a publicly available index (e.g., prime rate) and a fixed lender-specified margin. Borrowers are allowed to make interest-only payments during the draw period. At the end of the draw period, the loan amortizes into a standard adjustable rate mortgage (ARM) where the borrowers makes monthly principal and interest payments.
| • |
2nd Mortgage Loans to 125% |
 |
| • |
Home Equity Lines of Credit |
| • |
Home Improvement Loans |
| • |
80-20 Home Equity Lending |
| • |
Fixed rate Home Equity Loans |
The most popular home equity loan for first-time homebuyers is the 125% LTV (loan-to-value) loan because they generally don't have enough equity in their homes for standard second mortgage loans. 125% loans are generally fixed-rate HEILs. Home equity lines for home construction provide the most flexibility for paying different contractors at different times, which is why these are popular for home improvements.
Home improvement is the process of renovating or making additions to your home which can include remodeling, pool construction, replacing or repairing your roof, a room addition or general property improvements. Improving your home can increase your home's value.
According to a national survey conducted for Bank of America by MARC Research, 60 percent of homeowners believe that putting more effort and resources towards home improvement is the best way to increase home value. In some cases, however, home improvement projects don't always add as much value at resale as they cost, according to a national 2005 Cost vs. Value Report from the National Association of Realtors and Remodeling Magazine.
Home Improvement Projects That Provide the Greatest Return at Resale:
| Project |
Cost |
Added Home Value |
| Siding Replacement |
$10,393 |
$10,771 |
| Bathroom Remodel |
$10,499 |
$10,727 |
Home Improvement Projects That Provide the Least Return at Resale:
| Project |
Cost |
Added Home Value |
| Siding Replacement |
$10,393 |
$10,771 |
| Bathroom Remodel |
$10,499 |
$10,727 |
2nd Mortgage Refinance and revise your loan with a fixed rate. Stop paying costly private mortgage insurance (PMI). Available with an adjustable or fixed rate. 125% 2nd Mortgage Loan amounts to $125,000.
Poor Credit Refinance Mortgages A refinance loan that offers more choices for the borrower each month. Bad credit, late mortgage payments and past Bankruptcies are OK! |
 |
Get approved for a 2nd mortgage in just a few minutes and compare several home equity options from All-Star Mortgage Lenders. Home equity credit lines offer access to money for home improvements and bill consolidation.
Get cash out with 2nd mortgage loans and credit lines amounts. Choose from interest only, 100% home financing, fixed interest rates and negative amortization. |
|
