HELOC or a home equity line of credit, is the most suitable choice if you need a huge loan. Rocket Mortgage is basically an online platform or a website that directs users towards the most suitable credit. You just have to provide your financial information on the given platform. It is the no.1 lender’s platform in US, its services are available in all 50 states and also in Washington. While it’s head office is situated in Detroit. In this article, we have provided a complete info about what is rocket mortgage HELOC? What are the requirements for heloc and how it is so beneficial?
How can you qualify for HELOC with rocket mortgage?
There are some requirements for providing any type of credit. Some main requirements for HELOC are:
- Equity of at least 15% to 20% of the entire value of the residence
- A ratio of debt to income must be between 40% and 50%
- Proofs that you have paid your bills on time
- You can qualify for this type of credit when your credit score is maximum 680 and least credit score is 620.
Key points about rocket mortgage HELOC:
Regarding home equity loans and home equity lines of credit (heloc), there are some misconceptions among the public. Following are a few important points about heloc and home equity loan:
- Many people though that home equity loan and home equity line of credit are the same terms but actually they are two different terms. The main difference b/w both these terms is the interest rate. The interest rate for heloc is variable while it is fixed in case of home equity loan.
- Heloc allow to withdraw funds as long as the borrower is paying the amount of interest.
- The payment amount is also fixed for home equity loan but not for heloc.
- There is risk of losing your home forever if you violate any rule or doesn’t fulfill any term.
Rocket mortgage will guide you to the best offer that is suitable for you according to your financial condition.
What are the advantages and disadvantages of rocket mortgage HELOC?
In this type of loan, the house owner gets the amount in exchange of the valuation of his house. How much will this amount be? It depends on the valuation of the house. Heloc has a lot of importance as it is so beneficial. But there are also some demerits of heloc. Below we have listed both pros and cons of home equity line of credit:
- Home owners can get equity without losing their home forever.
- Interest amount change with the change in the rate of interest in market and also with the value of your property.
- A good step for the projects like improvement of your home, etc.
These are the some disadvantages of home equity line of credit:
- As interest rate vary with time, if it increases then it’s good for the borrower but if goes down then it would be in favor of the lender and the borrower has to face loss.
- In case (if the market rates come down or you face financial loss or anything like this) because of which you would not return the mortgage amount, you will lose your house.
- Payment is also variable like interest rate. Increase in the total payment can cause a problem for the borrower.