Common Uses for a Home Equity Loan


If you’re a homeowner, chances are you probably know that your home’s equity is important. Building home equity comes from a combination of paying down the amount owed on the loan, along with the home’s current market value. Fortunately in recent years, home values are continuing to rise across the country, which could positively affect the equity you have in your home.

Is it time for you to finally make that much needed addition or upgrade to your home? Or perhaps you’ve recently fallen a bit behind on credit card payments and need a little extra cash to get on track? Whatever the reason, you may find that a home equity loan is a perfect way to put the equity you have built up in your home to good use. One of the many things that make home equity loans so attractive is their flexibility. Below we have a short list of common uses for home equity loans.

Home Additions or Improvements

One of the most common uses of a home equity loan is for home additions or improvements. Is it time to design your dream master bathroom suite? Or perhaps you would like to finally create an outdoor living space so you can finally gather your friends and family for a killer backyard celebration. Whatever your home improvement goals, a home equity loan is a perfect way to gain the financing you need. And, the new additions to your home may also help increase your home’s value.

College Tuition Expenses

One of the many things that make home equity loans so attractive is their flexibility.

It’s been widely reported that college tuition is more expensive than ever before. Many parents are beginning their children’s college fund while they’re still crawling around on all fours. There are also a number of hidden costs that many people aren’t aware of. If you happened to get a late start on saving or you need a little extra, or if you are getting the itch to go back to school to complete your degree or are eyeing a career change, a home equity loan can help you pay for college tuition costs without tapping into your other savings accounts.

Debt Consolidation

Getting behind on your credit cards or other expenses happens. If this has happened to you, you may consider using a home equity loan to get you back on track. Because interest rates on credit cards are traditionally much higher than on a home equity loan, you may end up saving a large sum money on would be interest.

Major Life Events

As we mentioned before, one of the most attractive things about home equity loans is its flexibility. The funds can be used for just about anything. So whether you are hoping to finance a wedding, pay off medical costs or finally take that dream vacation, a home equity loan can help give you the cash necessary to pay for it.

Colonial Home Equity Loan Specifics

  • $20,000 – $200,000
  • Maximum combined loan-to-value (CLTV) = 80%
  • 700 minimum FICO credit score
  • No closing costs up to $100,000 unless appraisal is required
  • Title Policy and Title closing fees required when loan is above $100,000
  • 43% maximum debt-to-income (DTI)
  • Amortizing loan up to 15 years
  • Available for any purpose
  • Home Equity Loans offered in most states*

Contact Us Today

If you would like to know more information about a Home Equity Loan from Colonial, contact us today. One of our skilled professionals will be happy to answer any questions you have, like how much equity is in your home, repayment terms and more. Give us a call at 800.937.0423, or send us an email at HLC@GoColonial.com. We look forward to hearing from you.

*Home Equity Loans not available in AZ, FL, MA, NV and NY.

 

Related Article: Not sure if you have enough equity in your home just yet? We’ve answered some of the most common questions regarding Personal Line of Credit Basics.

 

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