Wells Fargo Home Equity Lines Of Credit Explained
Think you already know what this
subject is all about? Chances are that you dont, but by the end of this
article you will! Wells Fargo offers a revolving credit line for homeowners
called Home Equity Lines of Credit, or HELOCs. This line of credit is an
open-ended, revolving loan that allows future advances up to the approved
credit limit.
You can use the money for home
improvements, debt consolidation, medical expenses, investment opportunities,
starting a business, education, a new car or boat, or any other major expense.
Since Wells Fargo's Home Equity Lines of Credit are revolving loans, you
can use only the money you need when you need it, much like credit cards.
This credit is available at
any time during your draw period with convenient access through your Wells
Fargo credit card, checking account, ATM, online banking, or local bank.
The draw period of a Home Equity Line of Credit is the amount of time the
line of credit is open, usually ten years, after which the line of credit
is closed and repayment starts.
Keep reading further to learn
how this topic can benefit you, as the rest of this article will supply
you will the needed information.
Advances taken out during this
draw period may have small monthly payments in which only minimal amounts
are paid toward the principle with the rest of the payment going to accrued
interest, or interest only payments may be made. Wells Fargo offers plans
that allow repayment of the Home Equity Line of Credit loan over a fixed
period of time after the draw period has ended. Some of these plans allow
up to thirty years repayment time.
Interest of Wells Fargo Home
Equity Lines of Credit is variable and tied to the Prime Lending Rate,
the rate in which most major banks charge their largest and most credit
worthy customers. This variable rate usually has a cap to limit how high
of an interest rate can be charged and some have limits as to how low the
interest rate can get. Variable rates are subject to quarterly adjustment
though some plans offer a fixed interest rate. The interest paid on Wells
Fargo Home Equity Lines of Credit is only paid on the funds that are used
and is usually tax deductible.
Like Home Equity Loans, Home
Equity Lines of Credit have fees that may be charged for taking out the
loan. Some plans call for one-time; up front fees while others have annual
fees. Plans that offer low monthly payments during the draw period may
require a balloon payment at the end of the loan period requiring the entire
remaining balance to be paid.
Other fees can also apply such
as appraisal fee, credit check fee, and closing costs. The Federal Truth
in Lending Act protects the borrower by requiring the lender to inform
the borrower of all costs and terms when the application is given. Still
need more information about this topic? To learn more, visit your local
library or do a simple Internet search.
Author-Bio: Ken Charnely is
a personal finance enthusiast whose website http://www.online-loans-pro.com/
is dedicated to quality information on everything online loans. |
