Consolidate Your Debts With Home Equity Loans

Your home is your biggest asset. It does not just provide you shelter; it
also comes to your aid when you are in financial distress. The equity of
your home, built over the years, can be used to obtain loans by acting as
the collateral. You can find two types of home equity debt, namely in the
form of home equity loans and also in the form of home equity lines of
credit otherwise known as HELOCs. Both of them are described as second
mortgages, because just like the primary mortgage, the equity loan is also
secured by your property. But unlike the first mortgage, the equity debt is
repaid over a shorter span of time. The first mortgage is usually repaid
over a span of 30 years, whereas the equity loan is usually paid within
fifteen years. However, there are exceptions and the repayment period may be
as short as 5 years and as long as 30 years.

The growing popularity of home equity loan generally coincides with the
recent surge in property value and relatively lower rate of interest. Thus
more and more homeowners are turning to home equity loans for managing their
personal debts. Other advantages of the home equity loan also include lower
interest rate and tax deductions, making this mode of debt even more
popular.

So far as the equity rate of interest is concerned, it is slightly higher
than the first mortgage, but considerably lower than credit card loans or
other consumer loan interests. Because your property is used as the
collateral in equity loans, lenders consider them as secure as the first
mortgage.

The tax deduction feature may be the biggest reason behind the huge
popularity of home equity loans. Mortgage debt comes with attractive tax
savings compared to lets say consumer loans, thus it is highly cost
effective to consolidate your other debts with this loan and enjoy lower
interest rate plus tax deduction benefits at the same time.

With these benefits, namely considerably low rates for equity debt and tax
deduction on the interest payments, it is no wonder that a number of
homeowners are utilizing the equity of their homes to meet further expenses
and debts. True, it is a mortgage on your precious home, but if you are able
to pay back the entire amount within a short span of time and you have
stable income, home equity loan is a good option for much needed credit.

About The Author: If you want to secure a Home Equity Loan go to Susan's
site at http://www.superbhomeequityrate.info and
http://www.superbhomeequityrate.info/best-home-equity-line.htm.
You can read more Home Equity articles at http://www.mynicheblog.info.