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Home Equity Line of Credit (HELOC)
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Fixed Home Equity Loan
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Scenario
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David and Cherie have a son starting college in the fall. They also have a kitchen that needs remodeling, but aren't sure yet what that will cost. They need a loan that allows them to draw money as expenses arise.
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Victor and Kristen want to add an office onto their home. They'd also like to consolidate some credit card debt. They're ready to start both projects and know exactly how much they need to complete them.
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Fund Accessibility
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Draw funds as needed
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Receive entire sum up front
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Primary Benefit
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Lets David and Cherie borrow only what they need to cover expenses as they come up
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Provides a lump sum to cover Victor and Kristen's total costs, with fixed interest rate and payment
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Payment Amount
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Depends on amount of credit used, current interest rate
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Depends on amount borrowed, term and fixed interest rate of loan
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Term of Loan
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10-year draw
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Up to 15 years
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Interest Rate
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Adjustable, based on current prime rate
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Fixed for entire term of loan
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Combined LTV*
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Up to 95 percent
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Up to 95 percent
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Limitations
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Interest rate could fluctuate
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Must make payments on full loan amount from the beginning
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