A major difference between home equity line of credit and home equity loan is how the money is distributed. They are both secured loans because your home is used as the collateral to back the loan.
Leveraging home equity makes financial sense, when you do it for the right reasons. Using the equity in your home with a home equity loan or home equity line of credit can be a financial gain for you. To determine a smart use of a home equity line of credit or home equity loan, do your research so your focus is on responsible borrowing.
The equity you build in your home stands as collateral for a home equity loan or line of credit and both are considered secured. The interest rates for a home equity are typically lower than a credit card, a type of loan that is unsecured. When looking at your home equity from a when and how perspective, let’s break this up a bit.
When it comes to making changes or doing upgrades to renovate your home, the best type of remodeling or renovation projects should be chosen because they add value to your home. Home improvement projects are a great way to boost the value of your home without having to spend a lot of cash. It is important to review your options and figure out the project that will provide you with the most value. ChoiceOne Bank can guide you. We can help with your financing through a home equity line of credit.