Virtual home financing
How does a home equity loan work?
The requirements can vary depending on the lender and your individual financial situation. However, when applying for a home equity loan, lenders will look for:
Sufficient equity: Lenders typically require that you own at least 20% to 25% equity in your home.
Good credit score: In most cases, the minimum credit score requirement is 620, but 680 is favorable among lenders.
Stable income: You'll need proof of employment or income, such as pay stubs, W-2 forms, or tax returns.
Debt-to-income ratio (DTI): DTI is the percentage of your income that goes toward debt payments. Requirements vary from lender to lender, but most have a maximum threshold of around 43%.
What can you use a home equity loan for?
There are no restrictions on leveraging your home equity loan funds. You can finance various goals, such as:
Renovating your home
Covering medical expenses
Making aging-in-place home upgrades
Funding an investment or business venture
Paying for IVF or adoption
Covering other major purchases or recurring bills
How does a home equity loan work?
The requirements can vary depending on the lender and your individual financial situation. However, when applying for a home equity loan, lenders will look for:
Sufficient equity: Lenders typically require that you own at least 20% to 25% equity in your home.
Good credit score: In most cases, the minimum credit score requirement is 620, but 680 is favorable among lenders.
Stable income: You'll need proof of employment or income, such as pay stubs, W-2 forms, or tax returns.
Debt-to-income ratio (DTI): DTI is the percentage of your income that goes toward debt payments. Requirements vary from lender to lender, but most have a maximum threshold of around 43%.