Home Improvement Advice: Home Equity Credit Lines Versus Fixed Rate Second Mortgages
Are you thinking about mining the equity for a home improvement loan, but are wondering if you have missed the boat not doing a refinance and cashing out? There are still many home equity loans available that may suit your needs without breaking the bank with payments. "Home-equity loans have been growing at a large clip for years," notes Wells Fargo spokeswoman Mary Berg. "It's definitely slowed, but people are still borrowing. They're finding other products that are more flexible in this rate environment." It’s true that there are many options for consumers these days and home equity loans are available as a credit line with variable interest, as a fixed rate mortgage, and you can even find a second mortgage with interest only payments for a set period. A home equity line of credit generally has a variable interest rate tied to the prime index, which is published daily in the Wall Street Journal. The rate is dictated by the Federal Reserve. This loan work