"My Husband and I Have about $15,000 in Debts and We Own a Home. However, We Have Only a Few Thousand Dollars in Equity in Our Home. What Are the Chances of Our Qualifying for a Home Equity Loan? What Are the Advantages and Disadvantages

The Washington Times (Washington, DC), May 15, 1998 | Go to article overview

"My Husband and I Have about $15,000 in Debts and We Own a Home. However, We Have Only a Few Thousand Dollars in Equity in Our Home. What Are the Chances of Our Qualifying for a Home Equity Loan? What Are the Advantages and Disadvantages


Each week, Second Opinion asks two real-estate professionals one of your questions. Read what they have to say, right here.

PROPERTY SECURES LOAN RISK

NAME: Eric Weinstein

TITLE: President, Carteret Mortgage Corp.

PHONE: 703/802-8000

The market has really changed the past few years, and there is a plethora of new home-equity-line products available.

Home equity lines (also known as second mortgages) are priced according to the risk to the bank. The higher the combined loan to value, the pricier it gets. The combined loan to value is calculated by taking your first mortgage plus your proposed second mortgage and dividing that amount by the estimated value of your home.

Based upon this CLTV, a second mortgage typically is the cheapest source of money you will be able to find compared with credit cards and unsecured loans. First, such a mortgage is usually tax deductible. Second, the bank can feel very safe, because people will pay a loan against their house before anything else.

The advantages of a home equity loan are:

1. Cheaper rate.

2. Tax deductibility.

3. Longer term, allowing lower monthly payments

The disadvantages of a home equity loan are:

1. It is a lien against your house. If you don't make your loan payments, you could lose your house.

2. If you borrow all or most of the equity (say 95 percent to 100 percent), you may not be able to refinance or sell your home without paying it down.

USE CARE IN PICKING PROGRAM

NAME: Bob Gill

TITLE: Senior loan officer, Atlantic Coast Mortgage

PHONE: 703/818-7835

Let's say you have $3,000 of equity in your home: You owe $97,000 and the home is worth $100,000. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

"My Husband and I Have about $15,000 in Debts and We Own a Home. However, We Have Only a Few Thousand Dollars in Equity in Our Home. What Are the Chances of Our Qualifying for a Home Equity Loan? What Are the Advantages and Disadvantages
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.