Home Equity Loans

A home equity loan allows homeowners to borrow money by using the equity in their home as collateral. Equity is the difference between the home's current market value and the remaining mortgage balance. This type of loan provides a lump sum of cash, which can be used for various purposes, such as home improvements or debt consolidation. Homeowners typically repay the loan in fixed monthly payments over a set period. Since the loan is secured by the home, it usually offers lower interest rates compared to unsecured loans, but it also carries the risk of foreclosure if repayments are not made.