Learning Center
Basic Finance
How Credit Affects You
Preparing for Home Ownership
Steps for Buying a Home
Life as a Homeowner






 
Additional Resources
  • For more information about affordable loan programs and new home loans including Home Equity and Refinance call
Module 3
Preparing for Home Ownership
Ready for Home Ownership?
line
< PREVIOUS | 1 | 2 | 3 | 4 | 5 | 6 | NEXT >

Home Equity Loans

How Much Can You Borrow?The amount of equity in your home can be a valuable resource when you need money for special expenses. A lender may allow you to take out what is called a home equity loan. The amount you can borrow is based on a percentage of the appraised value of the home, minus the amount you still owe on the home loan. For example:

Value of the property:

$200,000
Lender will loan 90% of value: $180,000
minus balance due on loan: - $160,000
Amount available for home equity loan $20,000

Your Home as a Resource
A home equity loan might not make sense in the early years of home ownership but as equity builds it can be tapped if you need it. Remember — once you have taken out a home equity loan you will have to make payments on that loan in addition to your regular monthly home loan payment. If you were to sell your home, the amount you will receive will be reduced by any amount you still owe on the home equity loan. So it’s important to save this resource for special needs and consider carefully before using it.

< PREVIOUS | 1 | 2 | 3 | 4 | 5 | 6 | NEXT >
  Countrywide Home Loans, a division of Countrywide Bank, FSB is an Equal Housing Lender. © 2007 - 2008 Countrywide Financial Corp. Trade/service marks are the property of Countrywide Financial Corp., and/or its subsidiaries. All rights reserved. The content of this website is provided for the convenience of our readers and is for informational purposes only. Readers are encouraged to use the content of this website to supplement their knowledge and to also seek out other reliable sources of information prior to engaging in the home financing and home buying processes. The information featured herein is intended to be accurate and we will make efforts to keep this website updated. However, due to the rapid changes occurring in the programs, products, services offered within the home financing industry, we do not guarantee the accuracy of the information presented. Countrywide is not responsible for the contents of, or products or services offered on, third party Web sites and provides links to such sites solely for your convenience. This is not a commitment to lend. All rights reserved.