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Home Equity Loans Company - 7 Key Questions to Help You Choose One

Home Equity Loans Company - 7 Key Questions to Help You Choose

One.

Choosing the right home equity loan can be tricky; you have to

consider interest rates and repayment schedules, among others.

Choosing the right lender, however, does not have to be a

difficult task. If you ask the right questions, you can pick

the best lender for your needs. The following is a list of seven

essential questions that you should ask any potential lender.

1. What are the terms? This will include interest rates and the

length of the loan. Some lenders may require you to carry

private mortgage insurance or to pay your mortgage through ACH

deposit. Get the terms in writing, so that you can compare them

with other lenders.

2. How about my credit? Your credit score may play a huge

factor in deciding which lender to go through. If you have bad

or no credit, many lenders may not be able to help you. So you

will want to find a lender that offers sub-prime loans for

borrowers of your credit status. Bad credit does not

necessarily disqualify you for a loan, but it will make the

process a bit more difficult.

3. What is their reputation? The lender will delve into your

personal and financial history, so why shouldn't you do the

same? If the company is public, you should have no trouble

finding financial and news information. Look for recent mergers

or restructurings that could indicate a potential problem. Be

weary of lenders that are not publicly traded. Many lenders use

the same underwriters, so do your homework beforehand.

4. How much will the loan cost me? Closing costs can be a major

concern for most homeowners. You probably need the home equity

loan because you are short on funds or in debt, so coming up

with a few thousand dollars for closing costs can be all but

impossible for many borrowers. Your lender should be able to

provide you with a good faith estimate (GFE) that will outline

the fees that you will be responsible for.

5. How long is the process? A typical home equity loan, should

not take more than a month on average. Ask your lender how long

the process will take from the initial application to receipt of

the funds. This can be particularly critical if you are needed

to do repairs on your home, such as purchasing a new water heater.

6. Is the staff knowledgeable? Never underestimate the power of

a good customer service representative. Ask the loan officer

and others in the office the various questions that you have.

They should be knowledgeable on the loan process, and be able to

guide you through the process.

7. Early payment penalty? If you won the lottery or got a big

raise, would you be able to pay your loan off early? Many

people forget to ask this question when choosing a lender, but it

can save you thousands of dollars. So, make sure that if you

choose to sell your home before it is paid off, you will be

covered.

Use your common sense when choosing a home equity loan bank.

Research the company just as you would with any major purchase.

Don't be afraid to ask questions, and to try another lender if

you don't get the answers that you desire. It is your home and

your money on the line, so do your homework!

John Ross is a freelance author who writes articles about

financial loans including: http://www.loanchbox.com/ ,

http://www.loanchbox.com/online-home-equity-loans.html , and

http://www.loanchbox.com/home-equity-loans-fixed.html The

Loanchbox is a user friendly website designed to inform

beginners about home equity loans.

This article is free for republishing
Source: http://www.articlealley.com/article_5076_19.html

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