Keeping your Wisconsin home in good shape preserves its market value and saves money in the long run. If your home could use some repairs, today’s low interest rates can make it affordable to finance your projects. Here are financing ideas to get you started!
First, check the equity value of your home. This is the difference between any outstanding mortgages on your home, and its current market value. Lenders typically allow you to borrow up to 80% of your home equity, depending on your credit and your ability to repay. There are three main types of home equity loans:
Home Equity Line of Credit (HELOC): This enables you to borrow against your equity in increments. There is a maximum loan limit, but you can borrow less if you wish. HELOCs can be ideal if you’re doing several projects and want to borrow as needed.
However, the interest rate on a HELOC tends to be variable, which means your loan payments could increase over time. A HELOC is essentially a second mortgage, and it would tie up a chunk of your equity until it is paid back and closed.
Cash-Out Refi: If you want to refinance your mortgage to a lower rate, and draw out some equity value, this loan accomplishes both with one transaction. You would receive your equity proceeds in a lump sum at closing.
Home Equity Loan: This is a fixed-amount loan based on your available home equity. You would receive your loan proceeds in a single lump sum. It’s basically a second mortgage, same as a HELOC, but the terms tend to be simple.
Sitting down with a trustworthy, local lender is the best way to examine your financing options. We’ll be happy to give you a personal referral! Six Lakes Realty is a locally-owned family business with over 40 years of experience in Northwestern WI real estate. Call us today for friendly, hometown service!
Six Lakes Realty
Office: (715) 924-4806