Home Equity Loans

Unlocking the value of your property

As homeowners we often can't see the wood for the trees. For most of us owning our own homes is all about the mortgage we have to pay on it. With most mortgage terms lasting a standard 25 years it can be hard to feel that our property has any real value until the mortgage is paid off in full.

Although the life of our mortgage may indeed seem like a lifetime in itself, we should never lose sight of the fact that we do pay off loans over time. As we do this our debt decreases and we actually 'own' more of the property. This is especially true if we live in areas where house prices have risen significantly.

The money that we (or the property market!) build up in our home may seem like untouchable money. We know it's there but what can we do with it? Many people think that the only way to access this cash is to sell their homes. The reality is that we can take out home equity loans to free it up without having to move at all!

What is a home equity loan?

This type of loans product basically works on the idea that you use the amount you own within your property as collateral against a loan. You put it up as a guarantee to your lender that you can repay any loans. This allows you to free up the amount you already own within your property and use it as hard cash.

Most lenders will work out how much equity you have for you - but it's simple enough to do it yourself. All you need to do is to work out how much your property is currently worth and then subtract your mortgage from it. If you're not sure how much is currently outstanding on your mortgage, have a chat with your lender and they'll be able to help you out.

So, for example, if your property is currently worth £100,000 and your mortgage is currently at £65,000 then the difference will be £35,000. This is your equity which can be used to take out home equity loans.

Why should I take out a home equity loan?

If you're looking to borrow money this is probably one of the easiest and most cost-effective ways of doing it. Lenders like giving out home equity loans because they know that they'll get their money back whatever happens (for this reason you should always be sure that you can afford the extra repayments!).

This all means that you can get the most preferential low interest loans rates and deals here in comparison to other loan products. Another big advantage - as already mentioned - is that this is a way of freeing up cash that is already technically yours. Without any of the hassle or costs associated with moving.

Which home equity loans are best?

Many people mistakenly think that they'll get the most preferential low APR rates for home equity loans from their current mortgage provider. Some believe that you have to go to your current provider to get this kind of loan. Neither fact is true. The chances are - if you shop around - that you'll find even better interest rates and home loans options.

This is where we can help you out. We have built a database of home equity loans providers and all their products - this contains every single UK product that can be used for this purpose. So, to put it simply, we look everywhere and whittle down your choices to the best quotation costs. So, you can free up your cash and feel confident that you're getting it at the lowest possible cost. All you need to decide is what to spend it on!

Extra Finance: Secured loans online UK quotes