Home equity news: The truth about home equity offers and mortgage rate timing
The top stories in home equity, mortgages and real estate
Interest rates round-up
The average rate on a $30,000 home equity line of credit (HELOC) fell to 8.05 percent, according to Bankrate’s national survey of lenders, as the Federal Reserve cut interest rates by a quarter point, its first reduction this year. Meanwhile, the average $30,000 home equity loan rate rose five basis points, to 8.28 percent.
In anticipation of the rate cut, the average rate on a 30-year, fixed-rate loan dropped this week to 6.30 percent, its lowest point since October 2024, according to Bankrate’s latest national lender survey.
Before you say “yes” to that home equity offer
If your mailbox has been packed with flashy offers to “unlock your home’s equity,” you’re not alone. With U.S. homeowners sitting on a record $17.5 trillion in equity, lenders are eager to get you to tap into your home’s value. Before signing on, not only should you verify the offer is legit, but you should also read the fine print carefully to determine if borrowing makes sense right now.
How to say goodbye to PMI
If you put less than 20 percent down on a conventional mortgage, you’ve probably been paying for PMI (private mortgage insurance) to protect your lender. The good news? It doesn’t last forever. Find out how to get rid of PMI.
Is now the right time to tap your home equity?
With home values at record highs, tapping your equity can be tempting. HELOCs offer flexibility, and home equity loans have predictable payments. But before taking out a loan, consider the risk of using your home as collateral and weigh alternatives, like personal loans.
Source: Cotality
Mortgage rate timing matters
Mortgage rates can change quickly, and even a few weeks can make a big difference in your monthly payment. With home prices high and rates unpredictable, the best thing you can do is be ready when rates dip. This means getting your finances in order, improving your credit and landing preapproval.
Loan or line of credit? How to decide
Home equity loans and HELOCs both let you tap into your home’s value, but they work differently. With a home equity loan, you get a lump-sum loan with fixed payments. On the other hand, a HELOC is like a credit card, which allows you to borrow as needed with variable rates. Evaluating your personal preferences — for example, if you prefer stability or flexibility — can help you decide which option is best for you.
Second mortgages made simple
Think your mortgage is the only loan tied to your home? Not quite. Second mortgages let you borrow against the equity you’ve built, either as a one-time lump sum through a home equity loan or as a flexible line of credit (HELOC) that you can draw from as needed. Here’s a comprehensive explainer on second mortgages.
In case you missed it
Technically, these stories were released in the previous weeks, but they’re still worth highlighting.
Emergency repairs? Here’s how your home can help
If you’re facing a big, immediate home repair, homeowner’s insurance and emergency savings should be your first line of defense. But if those aren’t enough, a home equity loan or line of credit could help cover some of those costly repairs. Here’s how to decide if tapping into your home’s value for the unexpected is the right move.
Mortgage terms made simple
Applying for a mortgage can feel overwhelming, with many key terms you need to understand. From fixed-rate and adjustable loans to concepts like amortization, APR and home equity, knowing the lingo can help you feel more confident about what will likely be the biggest purchase of your life.
Unlock your home’s value
Achieve your financial goals with predictable payments on a lump-sum home equity loan.
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