The key to unlocking your cash? You’re living in it.
Here are some ways to access your home equity.
Money is tight for many Americans as inflation rates increase, but home equity is at nearly an all-time high1. That’s why homeowners are tapping into their home equity to get quick access to cash.
By John Dustman , Senior Vice President, Head of Consumer Lending, Axos Bank NMLS #1392265
Over half of Americans have credit card debt, and many have been in debt for over 5 years2. This is encouraging homeowners to access their home equity and get cash they need to cover short- and long-term expenses. And with the average U.S. homeowner having about $193,000 available for borrowing3, Home Equity Lines of Credit (HELOC) and Home Equity loans are two popular ways to access that cash. Let’s dive into the main differences between the two and determine which one could be right for you.
What are they?
HELOC ? – It’s a line of credit with a set limit and a variable interest rate. At Axos, the lines of credit usually range from $30,000-$250,000.
Home Equity Loan ?– It’s a lump sum ranging from $75,000-$500,000 with a fixed interest rate. When you open a home equity loan at Axos, your current mortgage rate stays the same.
How do they work?
HELOC ?– The money is available when you need it. You can borrow funds then start paying down that total over the next 5 to 10 years starting with an interest-only payment required. However, the rate is based on the current prime lending rate, so it is subject to change.
Home Equity Loan ? – It’s a lump sum loan subject to a fixed rate in effect through the life of the loan term. You still get the loan, then pay it back, although the home equity loan rates tend to be higher than with a HELOC.
Both offer a useful way to borrow against your home equity and cover large expenses or other purchases. If you’re having trouble deciding between the two, the choice will usually depend on your own unique financial needs and wants.
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A HELOC might be your choice if you:
A Home Equity Loan might be your choice if you:
Interested in a HELOC or Home Equity Loan? Contact an Axos mortgage loan originator at 888-546-2634 or explore refinance options at Axos.
John Dustman ?leads mortgage banking at Axos Bank . His team offers a wide array of single-family residence mortgage options that are personalized to help homeowners meet their financial goals.
John holds an MBA in Finance from Northern Arizona University, W.A. Franke College of Business. He has been with Axos since 2015 and has held various positions within the mortgage industry over the past 18 years.
He’s passionate about educating consumers on ways to use mortgages as a tool to accomplish homeownership and wealth goals.