A home equity loan is a
type of loan in which the owner of the property borrows money and uses
the equity of the property as collateral. Generally these loans are
used for major financial expenses such as home remodeling, additions,
home repairs, medical bills, weddings or college education.
Home Equity Definitions
1) Home Equity: the money value of a property in excess of any claims
or liens against it.
2) The Value of a property above and beyond the amount owed on it.
Example: The current market value of your home is
$200,000 and your current mortage is down to $150,000. The "Home
Equity" is $50,000.
Choosing a Lender