AVP/Sr Mortgage Originator
Alaska USA Mortgage AK#157293
Phone: (907)261-3458 Cell: 223-4440
License: NMLS Unique Identifier #203077
The Truth About HELOCs
Home Equity Lines of Credit or HELOCS are a hot topic of debate these days. Praised as an extremely valuable financial tool by some experts, HELOCs worry other pundits who fear that uninformed consumers will end up putting themselves in even greater debt.
At YOU Magazine, however, we have no interest in furthering this debate. Instead, this article is designed simply to explain what HELOCS are and how they work, including their advantages and disadvantages. Finally, we will offer three scenarios borrowers might commonly face in today's market, and present how HELOCs could affect their short- and long-term financial goals.
What is a HELOC?
When consumers are presented with potential investment opportunities, the timing of the market or possible income tax ramifications may make it unwise to liquidate invested assets. With a HELOC in place, a responsible borrower won't necessarily have to miss out on calculated investment opportunities. A HELOC can also serve as a kind of financial insurance policy against:
Finally, borrowers should also be aware that the lender retains the right to suspend or reduce the line of credit available if any of the following occur:
Now that we've examined the potential benefits and dangers of HELOCs, let's take a closer look at some common HELOC scenarios that borrowers may encounter.
New Mortgages and Refis:
Considering a HELOC?
A HELOC is not a one-size-fits-all product. And, while it has definite dangers, it can be an extremely value tool if initiated properly and used responsibly. If you've been considering (or avoiding) a HELOC because of the recent flood of media reports, seek the advice of a mortgage professional to determine whether a HELOC could help meet your specific financial needs and goals.
License AK# 157293 Washington Consumer Loan Company license# CL-157293 California Residential Mortgage Lending Act, License# 4131067
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, 125 W Dimond Blvd #110
Anchorage, AK 99515
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