Benefits and Risks of the 125% Home Equity Loan

Nationwide Mortgage Loans examines both sides of 125% second mortgages. Consider the relevant information that pertains to secure debt consolidation for people looking to save more money. Lynda Nelms is an experienced loan officer and acclaimed published writer for home financing related articles.

In a recent article, Lynda Nelms uncovers the benefits of the 125% no equity loans. According to Nelms, and the legend of the 125 loan is making a strong comeback. The term "125%" arises when a homeowner wants to take out a second mortgage on their home and the balances of the 1st & 2nd mortgages exceed the homes' value. Any 2nd mortgage that has a combined loan to value between 101-125% is considered a 125% loan.

The article indicated that residential mortgage lenders continue to report increasing volumes of 2nd mortgage and home equity loan transactions. Nelms points out that the biggest increase comes from states along the coast like California, Oregon, Florida, Georgia, Maryland and Virginia. She further adds that 125% mortgages seem to be more prevalent in states that haven't been as blessed with home appreciations recently, like Missouri, Michigan, and Indiana. As with most home loans there are two sides to the equation displaying both benefits and risks.

More Home Equity Loans to Consider

Fixed Rate Home Equity Loans
Home equity loans are second mortgages that are secure to your home and have fixed interest rates. The fixed rate second mortgages offer a lump-sum with fixed payment schedules. (15, 20, 25 or 30 year fixed rate second mortgage).

Home Equity Line of Credit
Home equity lines are revolving lines of credit like credit cards, yet the are secured by your home collateral. With 2nd lines of credit you only pay interest on the amount of money you spend. Credit lines are revolving accounts that can be used over and over.

Nationwide broker offers helpful information about second mortgages, 125% home equity loans, lines of credit, and debt consolidation loans.

Significant Benefits of 125% Home Loans

  • Consolidate credit card and revolving debt into an equity loan can save you thousands of dollars in interest over the life of the loan.
  • Paying off expensive installment loans can significantly increase your cash flow
  • Converting compounding interest debt into a simple interest mortgage will help reduce debts quicker.
  • Refinancing variable rate credit with a fixed rate mortgage reduces payments
  • Getting cash out of your home to make home improvements can increase your home's property value

To read the rest of this published Nationwide Mortgage Loans artice, please visit ezinearticles.com/?expert=Lynda_Nelms

Consolidate Credit Card Debt and Lower Your Monthly Expenses with a 125% Fixed Rate Equity Loan
Loan Amount
Current
Payments
Home Equity
Payment*
Monthly Payment
Savings
$30,000
$695
$294
$301
$50,000
$1,145
$490
$655
$80,000
$1,792
$784
$1,008
* This is a sample of refinanced credit debt to and assumes interest rate for the 125% Home Equity Loan at 11.25%.

Senior loan officer Brendon Daly stated, "125 Home Equity loans are coming back like George Foreman did a few years ago."

Don't let the lack of equity stop you from saving money. If you own a home and have credit card debt...give us a call at 1-877-212-9478.

Copyright Nationwide Mortgage Loan Company 2006

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BD Nationwide Mortgage, 515 Encinitas Blvd. Ste 100, Encinitas, California 92024
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