Chicago, IL (August 31, 2024) — The Federal Savings Bank’s Senior Vice President Jason Smartt was featured in GOBankingRates®’ article 4 Reasons You Shouldn’t Use Home Equity to Invest in Real Estate, According to Financial Experts.
In this piece, Jason explains the differences and benefits of a home equity loan and a home equity line of credit or HELOC. Both are considered second mortgages, and Jason says, “If your primary mortgage interest rate is lower than the current market rate, tapping into your home’s equity via a loan or HELOC can help you avoid increasing your primary mortgage interest rate.”
However, if you’re unable to pay back the home equity loan or HELOC, you may be putting your primary home on the line if you use it to finance a real estate investment. So, borrowers should be certain they can afford both these mortgages even without the investment property’s income.
While a home equity loan or HELOC can be helpful to acquire an investment property, there are some limitations including qualifying for a loan and changing interest rates and home values.
Learn more from the article at https://www.gobankingrates.com/investing/real-estate/reasons-shouldnt-use-home-equity-invest-real-estate-according-financial-experts/
This article is intended for general informational and educational purposes only and should not be construed as financial or tax advice. For more information on financial planning or investment advice, consult a registered investment advisor or financial planner.
Contact:
The Federal Savings Bank
Jason Smartt
Senior Vice President
NMLS#2282831
[email protected]
https://www.thefederalsavingsbank.com/leadership/jason-smartt/
About The Federal Savings Bank:
The Federal Savings Bank is a federally chartered bank, veteran founded and operated. We are proud to be a nationwide mortgage lender, supporting borrowers in all 50 states. We believe in unparalleled experience, exceptional customer service, operational excellence, and community beyond walls.
This information is intended for educational purposes only. Products and interest rates subject to change without notice. Loan products are subject to credit approval and include terms and conditions, fees and other costs. Terms and conditions may apply. Property insurance is required on all loans secured by property. VA loan products are subject to VA eligibility requirements. Adjustable Rate Mortgage (ARM) interest rates and monthly payment are subject to adjustment. Upon submission of a full application, a mortgage banker will review and provide you with the terms, conditions, disclosures, and additional details on the interest rates that apply to your individual situation.
