A home equity loan is actually a second mortgage on your home. It became a lien on your house the minute you signed the papers. If you don't make the payments they can foreclose.
A home equity loan is actually a second mortgage on your home. It became a lien on your house the minute you signed the papers. If you don't make the payments they can foreclose.
So even though the loan is only 17000 and my house is worth 130,000 the house would go under foreclosure? the house is a Fannie May or Fha home, does that make a difference, I am paying it though a bit behind, just wanting to know and i really appreciate you helping me. thank you
Home equity line of credit is a version of a second mortgage but you do not take the money all up front. Its a bit like a big check book where the bank gives you a line of credit, usually at a much better rate than your original mortgage. I can't tell you to stiff other creditors but mortgage and HELOC are two types of loans you need to keep up with.
Yes, the home equity line of credit is also a second mortgage. You get approved for a maximum amount and you sign a second mortgage for that amount. Even if you don't take the full amount that they approved there is still a second mortgage. If you fall behind on any of the payments they can declare that you are in default and then start foreclosure proceedings.
I'll chime in with my 2 cents as well... the consequences are the same for defaulting on anything when your home is used for collateral. I'm sure you don't want to lose your home over $17,000. Plus, since it's such a major loan, you'll ruin your chances of getting another one any time soon.
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