Getting a home equity loan, can be a good way to access cash from your home equity when you need it. But many of our customers want to know how long the process will take. The good news is that it doesn’t take long. Depending on the complexity, a home equity loan usually takes between a few short days up to a few short weeks from the time of application to approval with cash in hand.
What is a home equity loan?
Also called a home equity line of credit or HELOC, a home equity loan is a revolving loan that you can continually borrow from and pay back (as long as you do not exceed the maximum approved loan at any one time). The amount that you have to pay back each month will depend on how much you currently have borrowed.
What happens when you apply for a home equity loan?
A number of documents will be required when you apply for a home equity loan including financial documents, how much money you still have owing on your mortgage, as well as a valuation of the property. Because the loan is based on how much equity you have in your home, it may be necessary for you to get a home appraisal before the loan can be approved.
Once the loan underwriter is satisfied that you have met all the conditions of the loan, the approval can go through quite quickly.
Why do people get home equity loans?
Home equity loans can be used for a number of purposes ranging from home renovation projects and renovation to consolidating high interest debt. The advantage of a home equity loan is that they have being fairly low interest compared to other types of loans. Because the loan is based on how much equity you have in your home, you don’t need to have perfect credit to qualify. Furthermore because it is a revolving loan, you only have to be approved once. Once you are approved for the loan, there will always be money to borrow provided that you have not at the time over the borrowing limit.
If you are interested in learning more about home equity loans, or if you would like to apply for one, contact me today. I would be happy to take you through the process and answer any questions you may have.