What is the difference between a home equity loan and a HELOC? Find out the main differences between the two and which one might be a smarter choice in todays market.
For more on this read:
Thousands of Homeowners Facing HELOC Foreclosure
When HEL Freezes Over — Who’s out in the cold with the HELOC freeze?
The $1.1 Trillion HELOC Problem
Fannie Mae and Freddie Mac have raised their loan limits, a move designed to make mortgage funds available and to ease the loan approval process for borrowers living in areas where housing prices are very high.
The new lending limits vary according to region, but typically allow for more borrowing power in areas where housing prices far exceed Fannie and Freddie’s previous loan limit of $417,000. As an example, borrowers in Honolulu, HI may now qualify to borrow as much s $793,750 under the new loan limits.
This is great news, as it evens the playing field for borrowers and mortgage lenders in areas with astronomical home values. The ability to qualify for conforming mortgages can ease the mortgage applicaton process and help borrowers save on financing costs associated with non-conforming jumbo loans.
Being bombarded by the constant (and mostly negative) news on the mortgage industry, many of us are viewing home purchase as a topic not for discussion; however, that approach may not be right for everyone.
The housing market has changed throughout the nation and some areas have been significantly more impacted than others. These fluctuations, on the other hand, have opened up potential opportunities to some buyers who are able to take advantage of the lower housing prices, decreased demand, and their fairly good credit score.
Custom stone counter tops. Professional grade stainless steel appliances. High end bath renovations worthy of a five star spa. Although luxurious upgrades appeal to homeowners, the surplus of homes on the market has changed the focus of many buyers, who seem less impressed with high end features than in recent years.
The S & P Case/Schiller Home Price Index dropped by 9.1 percent at the end of 2007, which represents the largest drop in the index’s 20 year history. The index measures home prices in 20 key market areas throughout the US. Decreasing home prices can make it difficult, if not impossible, to sell a home or refinance home mortgage loans.
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