Key Highlights
- Current record-high amount of $6.5T in tappable home equity for homeowners nationally
- If wanting/needing to tap (use) that equity, com recommends five best home equity loan companies
American homeowners with mortgages are more “house rich” than ever. By “house rich,” we mean that American homeowners with mortgages have more tappable home equity than they have ever had…a whopping $6.5T, according to CoreLogic.
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Investopedia tells us that home equity is “the value of a homeowner’s interest in their home. In other words, it is the real property’s current market value less any liens that are attached to that property.” Essentially, home equity is the homeowner’s interest in the home. If you or your client bought a home for $300,000 and you and/or your client has already paid $100,000 on that home mortgage, you and/or your client still have $200,000 left to pay on the mortgage AND you and/or your client has $100,000 of home equity.
Bankrate tells us that the average homeowner with a mortgage gained $14,700 in usable equity over the past 12 months and has approximately $114,000 of home equity. That average homeowner could then choose to apply or tap into that home equity of $114,000 to free up cash BUT that cash only becomes liquid when the homeowner chooses to do a cash-out refinance, get a home equity line of credit (HELOC), take out a home equity loan or sell the home.
Let’s focus here on home equity loans and HELOCS.
Money.com recently put together a list of what it considers to be the five best home equity loan companies. Obviously, you and/or your clients can start this home equity loan/HELOC process by going to the original lender that gave you and/or your client the primary mortgage but we suggest you/your client shop around and get multiple quotes.
Money.com’s Best Home Equity Loan Companies
Best Customer Experience – Navy Federal Credit Union
Fastest Approval and Funding – Figure
Best Cost Transparency – DiscoverHome Loans
Highest Customer Satisfaction – Regions Bank
Best Customer Perks – BB&T
Navy Federal Credit Union is obviously a credit union with membership specifically designed for homeowners who are associated with the military. Navy Federal provides a digital experience under the moniker of Home Squad that has a customized organizational checklist for its members plus a team of people to help members applying for home equity loans or HELOCs. BUT…know that Navy Federal recently announced it isn’t taking new applications for lines of credit or home equity loans right now so keep checking back with this credit union.
Figure is a newer mortgage company that offers mortgage refinance loans and HELOCs FAST…sometimes in five minutes, sometimes in the same day, sometimes in five days BUT borrowers do DEFINITELY pay for that speed. Interest rates tend to be higher (depending on credit scores) than other lenders and there may be additional fees. Bottom line here: if fast is a priority, double check on ALL current fees.
DiscoverHome Loans has been around for a long time due to its commitment to transparency. Home equity loans enable access from $35,000 to a maximum of $200,000 in home equity with fixed rates. Make sure to check for rate differentials on first liens and second liens. Discover assigns a banker to the borrower to assist with all aspects of the application process and also offers borrowers the latest in technical features and applications. Discover is currently NOT offering HELOCs.
Regions Bank came out on top in the 2019 J.D. Power and Associates US Home Equity Line of Credit Satisfaction Study so take it from there. Regions offers HELOCS and home equity loans along with a tool that helps to determine which loan product is most appropriate for your needs. It has a fixed introductory rate for the first six months of a HELOC with then rates shifting to adjustable after that Its “Loan in a Line” option per HELOC loans allows borrowers to convert part or all of loan balances to a fixed rate of interest. There is ONE HITCH…the property for which borrowers take out loans must be located in a state where Regions has a bank branch and not every state has a branch office.
BB&T ranked third in the 2019 J.D. Power and Associates US Home Equity Line of Credit Satisfaction Study so it is a highly credible company. It also offers great perks for both home equity loans and HELOCS such as no prepayment penalty fees, fixed and variable rate loans, no closing cost options and BB&T does pay appraisal fees to obtain current valuations on the borrower’s property. Best cost transparency,
In addition to using such tangibles as best customer service, fastest approval and funding, best cost transparency, highest customer satisfaction and best customer perks, and 2019 J.D. Powers and Associates US Home Equity Line of Credit Satisfaction Study, money.com also checked rankings on ConsumersAdvocate.org to determine the companies that came up first in a national search for the best home equity loans.
To read the entire report, just click https://money.com/best-home-equity-loans/
Thanks to money.com.
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