Q:

How do you get a home equity loan?

A:

Quick Answer

To get a home equity loan, consult with financial advisers, consider various options, ensure that you understand the terms and know your rights. Finally, apply for a loan.

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Full Answer

  1. Talk to financial advisers

    Consult with financial advisers to get a sense of your financial situation. Get advice on tax implications and other financial details to help you make the best decision. Discussing your options with financial experts also saves you time and money during the loan application process.

  2. Consider various options

    Shop different lenders to find the best deal on a home equity loan. Calculate the interest rates of the various lenders before making a decision.

  3. Read and understand the terms

    Find out the floor and ceiling rates of your lender. Calculate the rate increases, and check your finances to ensure that you can afford to pay off the loan. Ensure that you understand all the details of the loan before making a commitment.

  4. Learn your rights

    Ask for all information concerning your home equity loan program in writing before making any payment. Ask the lender to clarify caps, index rates, margins and other terms that are not clear. Find out if you are allowed to invoke the right of rescission, which permits you to cancel your loan within three business days without penalty. Apply for the loan only if you are comfortable with the terms.

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