Who is taking out Home Equity Loans? Every need requires money and it is not possible to have money available all the time. The idea behind taking a loan is to fulfill the needs and not actually waiting for the cash to come but borrowing from lenders. There are several types of loans available according to the need and economic status of people. Some of them are credit card loans, home loans and personal loans. A home equity loan is one of the most popular forms of loans. Due to an upward jump in inflation in the year 2000, the Federal Reserve started reducing interest rate. Eventually, it reached its record low, which provoked the American population to apply for home equity loans. First mortgage home equity loans have lower interest than second mortgage home equity loans. This further elevated the number of people who took these loans. Current situation is that home equity debt levels are soaring and people are taking the advantage of low interest rates resulting in high living standard. This has lead to fast elimination of high interest credit card loans because people are more aware about the benefits of equity loans. As the statistics suggest, the share of home equity loans among the contemporary generation is 78% higher than their father’s generation. Another significant observation is that, in the last five years, the number of buyers under the age of 25 years, buying their first home, jumped 20.2%. It is not true that only low-income groups are applying for home equity loans; ‘the middle income’ and ‘high income’ groups find it equally beneficial. All sections of the society are under heavy debts including the student section, and taking equity loans have become a preferable choice over credit card loans or any other loans. The salaried class is taking the maximum of home equity loans to pay off other debts in bulk and get rid of monthly payments. There is an intention to pay all debts back, before they retire from their job. Another significant section of the society is the retired section, that is the age group from 60 to 67, who apply for equity loan and pay off each and every debt at one time and stay away from the tension of paying loan in installments. Almost every citizen who owns a home has the access to home equity loans. All of them consult advisors directly or indirectly, so the awareness about different forms of home loan is almost 85%. Since home equity loans provide a convenient and secure route to loan payments it is popular amongst all the sections of the society.   Back     411 Web Interactive. Customer Care - Privacy Policy Issues 14100 W. Olympic Blvd 15th Floor West Los Angeles, CA 90064 800.706.6225 x6910 Effective Date: March 20, 2005

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