|
Wells Fargo Home Equity Lines Of Credit Explained
By: Ken Charnely
Think you already know what this subject is all about? Chances are that you don’t,
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.
About the Author:
Ken Charnely is a personal finance enthusiast with http://www.online-loans-pro.com/
dedicated to quality information on online loans. For all your online loan needs
visit and apply loans online
|
