Home Equity Line of Credit

The Advantages of the Number One Credit Type

Find out how a Home Equity Line of Credit was one of the best ways of financing your home improvement projects way back in 2006:- vintage article...

Discover that there are advantages beyond those provided by the more well know home equity loans.

Flexibility is paramount when you are planning bigger home improvement projects and taking advantage of home equity line of credit amounts only as you need them can help you control your improvement spending which is vital for bringing your project in on budget.

It is often found it easier to arrange changes to this type of credit than other loans, extra costs not calculated for had to be included on a basement development when it was found that the actual homes footings were not sufficient and more money was needed to be spent to complete the project to a satisfactory standard.

Sometimes when you start a substantial home improvement project, problems develop that neither you nor your structural engineer could have predicted until excavations were under way.

Allow for a decent contingency amount within your home equity line of credit budget right from the start, and of course if you don't need it - you won't have withdrawn it from your home equity line of credit account - so you should not be paying interest rates on unused loan amounts!.

A Home Equity Line of Credit
verses
A Home Equity Loan

The beauty of a home equity line of credit is that you take only what you need - when you need it and only pay interest on the part of the loan you have spent.

Keep in mind interest rate fluctuations which will be relevant to the daily rate on the day you use your loan - Unless you can secure a fixed rate on your home equity line of credit!.

A home equity loan - on the other hand - is one total payment into your account and you start to pay for the whole loan amount from day one.


Home Improvement Uses
for a Home Equity Line of Credit

It's usually advisable to opt for a home equity line of credit for any of the larger home remodeling projects, for example:

  • Building an Addition to your home - be a granny annex, additional family room, more bedrooms etc...
  • Extending the Kitchen space out into the garden to include a large kitchen with island and family dining area
  • Building a garage - with proper foundations
  • Developing a basement as a home office
  • Attic Conversions as a master plus ensuite
  • Remodeling numerous bathrooms - moving pipes and placing fixtures & fittings
  • Installing a swimming pool - plus swimming pool equipment, filter, heater, cover etc...
  • Extensive Decking - like a multi level deck and adding Decking Furniture
  • Insulating the envelope of your home

These are just some of the many wonderful home improvement projects and a home equity line of credit can help you develop and make your improvement dreams come true.


Your Home Equity Line of Credit Lender

Like anyone looking for any type of home improvement loan - always shop around and get at least 5 - 6 quotes so that you can decide which is the best deal for your situation. (but please don't overdo your applications as too many searches of your credit score could adversely affect you.)

Talk to any family or friends and neighbours who have made use of this type of credit to have major home improvements done, quiz them about their experiences with their lender and ask if they would use them again, it may be a good one to add to your short list.

Don't forget to read the small print, not all home equity line of credit lenders are the same. Take a close look at the different "additional" fees and how they may affect you.

Some of the bigger companies are often able to discount certain "extra" fees as a service to draw clients to use them.

Make sure that you sign with a company that is established enough to be able to give you the type of customer service you deserve - this is such an important point that it often out-weighs the cheapest offers available.

Let companies you talk to know that you have a short list of other home equity lenders to choose from. Letting them know that you are talking to "the competition" might just improve your conditions.

Once you have found a company that you like and agree to their terms, and then have had a good expeience with - it is going to make your home improvement financing search so much easier for your next project - but even then - keep comparing to make sure you always get the best Home Equity Line of Credit deal for you.


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