By definition, a home equity loan is a second mortgage. It uses the equity in your home as collateral to insure the loan with the bank or lender. This may sound intimidating for those who aren't familiar with the terminology, but these types of loans are quite common, safe, and can be extremely practical.
As the homeowner, you decide your home equity loan's function. For many, home equity loans act as funding for home improvements, debt consolidation, or debt elimination, or simply provide more flexibility in savings and cash flow. At Downs Financial, Inc., we offer terms from 10 to 20 years for home equity loans. This includes 30/15 plans, which offer the lowest payments available. In this plan, we offer a low fixed rate for 15 years, but the payments are calculated over 30 years, so they're lower.
At the end of the term, there is a balloon payment due, but most owners stay in houses less than 10 years nowadays and don't ever meet the balloon deadline. You can also refinance at this point. Whatever your preference, we make mortgages easy because we're mortgage experts.
Because the money you've already paid for your home secures your home equity loan, we are able to offer very attractive rates. In addition, most interest on a second mortgage is tax-deductible. As with any loan, points and closing costs are involved, but we do our best to keep these costs to a minimum. We want to establish a lifelong relationship with our customers, and we do so by being honest and straightforward in all our dealings. The average homeowner moves at least six times from the time they own their first home until the time they retire, and we want to help you through all those transitions.