The Many Benefits of Home Equity Loans

Are you facing a major lifestyle change, but are unsure of how to finance it? Obtaining a home equity loan might be the right answer for your finances. A home-equity loan, also known as a second mortgage, allows responsible homeowners to borrow money by leveraging the equity in their homes. Home equity loans are fixed-rate loans set at a lower interest rate than other lines of credit.

dollars-31085_640There are many benefits of a home equity loan that can help you secure financial assistance. Lower interest rates are an excellent draw for many homeowners. Home equity loans have lower interest rates compared to credit card annual percentage rates (APRs), and because a home equity loan is secured by the collateral of your home, lenders are more confident in a borrower’s ability to pay back debt. Borrowers benefit from this confidence with lower rates.

Borrowers can also benefit from a cash payment. Home equity loans, unlike other lines of credit, provide a lump sum of cash based on the amount of equity in your home, allowing you to pay off major expenses with one check.

Obtaining a home equity loan is an excellent option for certain and specific situations. If you are considering how to finance home improvement and renovations, a home equity loan can help you reinvest in your home and property value. Make the most of a smart investment by researching home property values in your area and making market-savvy options.

calculator-1276066_640An additional benefit of a home equity loan comes in the form of a potential tax deduction. With the consultation of a tax advisor, 100% of your home equity loan interest payments may be tax deductible. This can be a major advantage when comparing financial loan options, as 100% tax deduction may not be the case with credit card debt.

A home equity loan can simplify your finances and assist with debt consolidation. Home equity loans have fixed, lower interest rates and lower monthly payments. Additionally, a fixed rate will mean that you know exactly what you pay each month with no variation or surprises.

In the situation of a major life event or expense, such as a wedding or an unexpected medical expense, a home equity loan can help more than spreading such an expense over multiple credit cards or taking on private loans. While a home equity loan can be beneficial in certain situations, refrain from seeking a home equity loan on short-term expenses and property resales. In these situations, there will be better financing options at lower interest rates.

Twins Tickets Drawing

TopLine Federal Credit Union is sponsoring a sweepstakes in which you can enter for a chance to win a pair of Twins tickets valued at $191. Score a home equity loan or home equity line of credit and possibly a set of tickets to see the Twins in action! For more information, visit our website to see the Official Rules.

With so many options for financial assistance, let TopLine Federal Credit Union help pick an option that works best for your family to help you meet your financial goals, simplify your debt, and reach your ideal lifestyle. Apply online, or contact a friendly TopLine representative to get started!

 

The Benefits of Improving Your Credit

Having good credit is essential to a healthy financial well-being. This is due mostly to the fact that obtaining loans is a necessary part of life, and the availability of these loans is based on having a good credit score. Having a good score will help you buy a car, purchase a home, get lower interest rates – even obtain certain jobs.

Building Your Credit

So, how do you build good credit? If you don’t have credit, one of the easiest ways to start is to open a credit card. Search around and find one that doesn’t have a service fee and has a lower APR. At TopLine, we not only offer credit cards with tons of features, but they also come with many perks! Both the Platinum and Platinum Rewards VISA cards are loaded with benefits:

  • Screenshot (301)Low variable APR based on your credit history
  • No annual fees
  • No over-the-limit fee
  • Free eStatements
  • Free online account access
  • Automatic payment options
  • Cash Advances
  • VISA’s Zero Liability Program
  • Worldwide travel and emergency assistance
  • Free auto rental collision damage waiver
  • Warranty Manager Service

Calculating Your Credit Score

If you already have credit, it is important to know where you stand. Before you request copies of your credit report, make sure you know how your FICO Score is calculated. That will help you understand how to read your reports and what each score means. Here is a breakdown of the ranges of credit and what they mean:

  • Excellent Credit: 750 +
  • Good Credit: 700-749
  • Fair Credit: 650-699
  • Poor Credit: 600-649
  • Bad Credit: Below 600

The steps to find your credit score are as follows:

  1. Obtain a credit report – you are able to have one free copy per year. Make sure that you get a credit report from each of the credit bureaus: TransUnion, Experian, and Equifax.
  2. Compare and contrast the reports to find any discrepancies.
  3. If you find some that are inaccurate, be sure to dispute them right away. The longer they remain on your credit report, the more they bring down your score.

Improving Your Credit

Whether your credit report looks to be in good shape or needs improvement, it is important to consistently stay on top of it. The two easiest ways to do that is to reduce the amount of debt you owe as fast as you can and to set up payment reminders so that you don’t default. One of the fastest ways to pay off debt is to use the Debt Snowball Method. People have paid off tens of thousands of dollars in the matter of a few years with this strategy. You can also check out consolidation options to make payments easier and to lower interest rates. At TopLine, we offer personal loans as a form of debt consolidation.

Extra tips for how to improve your credit can be found here.

There are many benefits of having a good credit score – it simply makes life easier. You will see the benefits of lower interest rates and more financial opportunities open up for you like never before – good credit opens doors. Don’t go another day not knowing where you stand or having a bad creditor further lower your score.