An equity loan, often referred to as a home equity loan or second mortgage, allows homeowners to borrow money by leveraging the equity in their homes. It is a type of loan in which the borrower uses the equity of their home as collateral.
Equity takeout refers to the process of refinancing a property mortgage primarily to raise cash. This results in an increase in the debt secured by the property while leveraging the equity built into the home.
A high loan-to-value (LTV) loan covers more than 100% of the market value of the home. Typically, the coverage can go up to 125% of the property's value. These loans are mainly used for refinancing, making them a form of home equity loan, and are generally reserved for the lowest-risk borrowers.
A Home Equity Line of Credit (HELOC) is a type of home equity loan that provides an account from which the borrower can draw funds as needed, similar to a credit card. It allows for flexible borrowing based on the home's equity with interest accruing on the actual borrowed amount.
A Home Equity Loan is a type of loan in which the borrower uses the equity of their home as collateral. These loans are typically used to finance major expenses such as home repairs, medical bills, or education fees.
A loan is an arrangement in which one party borrows money from another party, often through formal agreements that detail the terms of repayment.
A prior lien is a legally enforceable claim or hold on a property that takes precedence over other liens. It is established before any subsequent liens and typically has higher priority in the event of default.
