Home Equity Loan Process

| November 5, 2011

Your Home Equity Loan Process

You wish to take out a loan on your home. Perhaps it is for home improvements. Actually it can be for a number for reasons. When you apply for money, you have a right to know what to expect. Here is what can occur in the home equity loan process.

Your first step will depend on who you borrow from. If it is online, you may do the most of the process online. However, the basics remain the same. You fill out an application with the lender. You provide the necessary information on the form.

It will consist of things like name and address. Spouse’s names are also included. There will be a section for your employment information. Put down your employer, in the proper space. They will want to know how long you have worked there. They also will need your wages or salary amount.

You will have to fill out credit information. It is best to have all of this written down, beforehand. You must provide all of the information about your first mortgage. Next you must include information on things like car loans. You have to put down your car payment and how much you owe on the vehicle. Any other loans must be reported. If you have charge cards, you must state the monthly payment amounts. You also need to know the balance on each account.

All of this credit information is used to determine your debt to income ratio. It is a very good idea to figure your own debt to income ratio, ahead of time. This way, you may save yourself a great deal of time and trouble. It is a bit involved to figure out your ratio. A good way is to go online and use a debt to income calculator. This will give you the numbers.

Debt to income is very important. In most cases, you cannot owe over 35 percent of your income, in debt. The debt does not include things like utility payments.

After you have filled out the application, you will need to sign it. You will usually be notified if you have qualified. Sometimes, this can take more than one day.

If you qualify, you will need to provide documentation. This will be things like tax forms, W2 forms, and bank statements. Your lender will provide you with a complete list. If there is an appraisal or inspection required, you will need to wait until that is done.

The next step is to sign all of the necessary documents. If your lender is local, you may receive your check at that time. If not, you may need to wait until the authorized person issues the check to you. The entire process may only take a matter of days.


Are you wondering about the home equity loan process? You will first need to fill out an application for approval. You will sign the application. If it is approved, you provide the necessary proof of employment, income, and such. Next, you wait for any appraisals or inspections to take place. After that you sign the documents and receive your check.

Category: Home Loan

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