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Home equity

Your home is probably your largest savings account. Here is how to use it.

Three ways to borrow against equity: a cash-out refinance that replaces your mortgage, a home equity line of credit you draw on as needed, or a fixed-rate second mortgage that leaves your low first-mortgage rate untouched. We show you the cost of each.

OptionsCash-out refi, HELOC, fixed second
Combined loan-to-valueUp to 80% to 85%
Keep your first mortgageYes with a HELOC or second
Use of fundsAnything
See if I qualifyCall (856) 606-1070
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Who it's for

Is tapping your equity right for you?

  • Owners with a low first-mortgage rate who need funds without refinancing it
  • Homeowners funding a renovation, tuition or a business
  • Anyone consolidating credit cards and car loans into one lower payment
  • Owners who want a standby line for emergencies
How it works

Three steps from here to closing.

Pick the tool

Cash-out refi if your rate is above market; HELOC or fixed second if it is below.

Application and valuation

Many seconds use an automated valuation instead of a full appraisal.

Close

Seconds and HELOCs often close in two to three weeks.

What you'll need

Requirements at a glance.

  • Combined loan-to-value up to 80% to 85% of the home's value
  • Credit score of 640 for most second-lien programs, 620 for cash-out refinance
  • Two years of income history, or bank statements for self-employed
  • Debt-to-income ratio within program limits
  • Primary residence for the best terms; second homes and rentals allowed with lower limits
Straight talk

The upside, and what to weigh.

Why people choose it

  • A second lien leaves your existing first-mortgage rate alone
  • Rates are far below credit cards and personal loans
  • Interest may be deductible when used for home improvements (ask a tax advisor)

Things to consider

  • HELOC rates are variable
  • Your home secures the debt
Common questions

Asked on almost every first call.

Cash-out refinance or a second mortgage?

If your current rate is below today's market, keep it and add a second. If it is above, a cash-out refinance can lower both.

How much can I borrow?

Up to 80% to 85% of the home's value minus what you owe.

How fast can I close?

Two to three weeks for most HELOCs and fixed seconds.