With warmer weather just around the corner, now is an ideal time to consider using your home equity to fund your home improvement projects. Whether you are looking to upgrade your landscaping, build a backyard deck, remodel your kitchen, renovate your bathroom, or take on another project, National Exchange Bank’s home equity loans, including a line of credit, make it easy.
In recent years, the average homeowner with a mortgage saw substantial growth in their home equity due to soaring home prices. This is great news for homeowners! If your home’s current market value exceeds the mortgage loan balance, you can borrow a percentage of that equity. NEBAT has put together a few things to consider if you are deciding if a home equity line of credit (HELOC) or home equity loan for home improvements is right for you.
Home Equity Loan
A home equity loan is based on your equity and uses your home as collateral. A borrower can apply for a set amount of money and upon approval of the loan, receive the amount up front. These types of loans offer fixed payments and fixed interest rates for the life of the loan making it easier to budget for. Using a home equity loan for home improvements or other purchases is often the preferred way to borrow, as they typically offer better terms than a personal loan or drawing from a retirement account. To estimate your loan needs, try our easy-to-use loan payment calculator.
HELOC for Home Improvement Projects
A HELOC for home improvement projects or other purchases can be another great option for homeowners looking to cash in on their home equity. These revolving lines of credit also use your home as collateral, but often have a variable interest rate and variable minimum payments based on the amount outstanding. Using a HELOC for home improvement projects allows you the flexibility to draw money as you need it up to a specified threshold, which is especially helpful if you are not sure how much you will need to borrow.
Using your home equity is the perfect way to fund your home remodeling or home improvement project. Using equity for home improvement projects makes sense as these projects often increase your home’s value helping you to build equity. Once your renovation is complete, you can move on to the best part - enjoying your updated space! Get started today by applying for a home equity loan or HELOC with NEBAT.