Home Equity Loan Tips

Video Transcript

"This is financial adviser Patrick Munro talking about what is the definition of a home equity loan. Of course our home is our biggest asset. When we get one and we take out our primary loan, we start to achieve a higher rate of return when we pay down the mortgage balance. And, of course, appreciation over time, the house gets worth more. The difference between the two is called home equity. And of course, you're able to take that out of your home by way of a home equity line of credit. And it's a great wealth-building tool, going forward, that works best when real estate house values are going up in value. In current times, however, house values in many states are going down in value. And banks, of course, are suffering credit crisis and not making loans as much as they used to. So it's mindful of you to always make sure that you have the best credit available so that you can take advantage of home equity lines of credit. This is Patrick Munro, financial adviser."