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!

 

Creating a Savings Plan for the Year

Creating a

January is coming to a close, and with it, many people’s New Year’s Resolution hopes. Each year, the top resolutions are about losing and saving: losing weight and saving money. Both can seem like daunting tasks, and although we aren’t experts on weight loss, we do know a thing or two about saving money.

Make Financial Goals
Saving for something special this year? Planning on making a major purchase or home improvement? Sending kids off to college soon? Setting goals for yourself is the first step in making a yearly savings plan. Setting a financial goal for yourself sets your destination in view and creates a timeframe to fulfill it.

Set a Budget
The most important aspect to setting a budget for a savings plan is to be reasonable and realistic. Base your budget on your income and monthly bills — and be sure to keep it flexible, if only at first. People can be overly optimistic about money before their plans are put into practice, and can become discouraged about getting on track.

Cover Small Debts First
This goes along with being realistic; smaller debts are easier to overcome than larger ones, and you don’t want to be paying more interest than you need to. Prioritize your loans into manageable payments and resolve to pay off smaller ones first.

Save for a Rainy Day
According to gobankrates.com, 36 percent of Americans have less than $1,000 in savings. No one knows what the future will bring. You best line of defense is being prepared for the worst. Start a savings account and add to it each month. Even if it’s as little as $20, it’s better than nothing. Save your change in a jar and deposit it at the end of the month, cut back on superfluous spending, turn your thermostat down a couple degrees — whatever you decide, small savings do add up, and they get you in the mindset to build a nest egg. Thesurvivalmom.com has a fantastic savings plan you can use or reformat to fit your budget.

It’s not hard to put a little money away each month — the difficult part is making a reasonable plan and achievable goals, especially a long-term plan for savings. TopLine Federal Credit Union has a ton of savings options to help you reach your goals. Our savings account rates are calculated daily to ensure you the best possible account earnings.

Don’t be another end of January statistic; start your savings off on the right foot, and by the end of the year, you’re sure to see that your dedication -— quite literally — pays off!