Home equity loans are consumer loans, in which a land, living or other type of property acts as collateral, the operation is the same as that of a personal loan.
In mortgage loan contracts, an interest rate, a term to be repaid, is agreed with the bank or financial institution and then the loan is amortized month by month by paying a fee.
Home equity loans work to finance contingencies, make housing reforms or in case of needing liquidity, however, these are not used to acquire houses.
They are usually quite beneficial since with them the totality of the debt will not be paid at a certain moment, but the payment of this will be made in small monthly interest installments.
What should be known before requesting a home equity loan?
A home equity loan is a solution only financing available to the owners of land, housing or any other property.
The home equity loan allows you to obtain money at a low interest rate through the ownership of a property as collateral, interests ranging from 2% to 10% but will depend of the company or financial entity that grants it.
When applying for a home equity loan, you should first take into account the interest rate, the amount to request and the term to pay, seeing these 3 aspects together to determine if the loan is beneficial.
One mistake many people make when applying for a home equity loan is studying the 3 variables previously mentioned, separately, which may generate damages in the future.
One trick to acquiring a better interest rate on your home equity loan is to negotiate the same every 2 years, with which a small reduction in the rate can be obtained, which may be significant in the future.
How to request a home equity loan?
Unlike traditional loans, loans with Mortgage They can be done through a company or financial institution, but which one is the best to request it?
PideTuCredito.com, which is a bespoke loan granting company for those who own the property of a property free of charges or have a fairly low remaining mortgage amount.
Request your credit It is registered with the Spanish consumer agency in order to comply with current regulations, in this way mortgage guarantee loans can be perfectly granted.
The requirements to apply for a home equity loan are based on owning land or a home and that they are Free of charge or one which is quite low.
Once the requirements have been met and the form for the mortgage loan application has been filled out, then PideTuCredito performs an analysis of the financial solvency that it has. The analysis is free and secure, with which they can issue a response in less than 48 hours.
Mortgage guarantee and credit
In practice, the terms “Home equity loan” or “home loan” and “mortgage” synonymously, but this is wrong because they do not mean the same thing.
What is their difference? A mortgage is a real security right, In other words, in real estate and mortgage loans, it is the guarantee of payment. This real right is registered in the property registry and has effect before any person who wishes to acquire the property.
The mortgage remains anchored to the property, That is why it is important to eliminate it before transferring the property, that is, canceling the mortgage, which is known as acquiring or buying a property free of charges.
If the mortgage is the guarantee, the home equity loan is the guaranteed obligation, that is, a money loan that a financial institution or company carries out to an individual in exchange for market interests, where the guarantee is the land, house or property.