There are many instances where a home equity from a local bank can be a smart financial decision.
Home equity is the portion of your home that you’ve paid off. It’s the difference between what the home is worth and how much is still owed on your mortgage. For many, equity from homeownership is a key way to build personal wealth over time. As your home’s value increases over the long term and you pay down the principal on the mortgage, your equity grows. (1)
This is one of the most common reasons that individuals choose to take out a home equity loan, since it allows them to fund costly projects using the equity in their home. Home improvements such as a kitchen or bathroom remodel add value to home and often allow it to sell for more after the renovations.
Using home equity to pay for college expenses can be a good, low-interest option if you find better loan rates than with student loans. (1)
Home equity loans can be used to pay off other personal debts, such as car loans or credit cards. These debts are often at a high-interest loan rate and consolidating them at a lower interest rate can help you save.
Unexpected expenses, such as medical bills, can be financed through a home equity loan when you have exhausted your other options.
Instead of using a personal loan or wedding loan, home equity loans are an option that typically provides a lower interest rate.
If you require more capital to grow your business, then a home equity loan can be an option for you to borrow money at a lower interest loan rate than with a small-business loan.
Once you have decided that you would like to go forward with a home equity loan, it’s important to do your research and find the best bank for home equity loan rates. Contact our banking team today at your local bank in Greenville, Hermitage, or Neshannock to get started!
1. 7 Reasons to Use Home Equity. Oct. 26, 2021.