Home Equity Loan Pros and Cons

A homeowner can obtain a home equity loan by committing their home to the lender as collateral to borrow money. Home equity loans make it possible for borrowers to borrow a large amount of money even if they have poor credit. This is made possible because the use of their home as collateral.

Home equity loans of credit are an amount of credit available based on a percentage of equity in the home (usually 75 – 80 percent of the equity in the home).

A home equity loan is a loan, not a line of credit or new home loan, and is usually considered a type of second mortgage on your home.

Lending institutions are often less concerned with losing money on home equity loans. If you default on your loan payments, you lose your home. With the use of your home as collateral, you are more likely to make those payments a primary concern.

Home Equity Loan Advantages:

• Characteristically lower interest rates or annual percentage rates are associated with home equity loans
• Having poor credit won’t necessarily exclude you from being able to qualify for a home equity loan
• Because you are using your home as collateral and this loan is viewed as a type of second mortgage, these loans will often have large sums of money available to you
• Maybe one of the best advantages of a home equity loan is that the payments may be tax deductible

Home Equity Loan Common Uses:

• Often home equity loans are used to consolidate debt - usually high-interest debt
• A common use for the money from a home equity loan is the remodeling or renovation of the home to improve the value of the property
• Another use that is common from monies obtained by a home equity loan is the purchase of property or another home

Before you consider taking out a home equity loan, you should keep in mind that if you default on the loan, you lose your home. If you do decide to use a home equity loan you should shop around carefully. Finding the right home equity loan could save you thousands. Make sure to compare offers found through banks, credit unions, brokers, websites, or other advertisements. Be picky and know what you’re signing. A home equity loan might be what you are looking for. Make sure you can make the payments, because you must realize that you will lose your home if you don’t.

The Home Depot Foundation

As the second largest retailer in the United States, second only to WalMart, The Home Depot boasts the largest home improvement retailer in the U.S. The Home Depot currently operates 2,193 warehouse stores in seven countries, employing 331,000 people in the U.S., Mexico, Canada, China, Puerto Rico, the Virgin Islands, and Guam.

Back in June of 1978 Home Depot founders Arthur Blank and Bernie Marcus opened the first two, 60,000 square foot warehouse locations in Atlanta, Georgia. The brand new home improvement retailer set out to build the largest construction supply and services warehouse and featured an astonishing 25,000 products in each of their stores.

When Blank and Marcus founded The Home Depot, the goal was to provide quality goods with superb customer service. But the two wanted to be a part of something much larger than simply a construction and home improvement retailer, Blank and Marcus wanted to give back to the communities that they represented.

In 2002, The Home Depot Foundation was established as a not-for-profit organization that funded and supported affiliated nonprofit organizations at rebuilding communities by offering affordable housing, the planting of trees in neighborhoods and schools, and building community parks and children’s playgrounds.

Furthermore, The Home Depot Foundation embraces communities and maintains relations through the improvement of long-term welfare in each supported community. The Home Depot Foundation long-term building approach constitutes designing and maintaining healthy, affordable housing in communities where residents want to live and thrive.

For additional information see:

The Home Depot Foundation

Home Depot Locations

The Home Depot U.S.