Equity home loan Meaning and Definition

Pronunciation

/ˈekwɪti hʊm loʊn/ 🔊

Part of Speech

Noun

Definition

A type of loan that allows homeowners to borrow against the equity in their property, using the value of their home as collateral.

Examples

• John used an equity home loan to finance his home renovation project.
• Equity home loans are popular among homeowners who want to tap into the value of their property.

Synonyms

• Mortgage
• Home equity loan

Antonyms

• Fully-owned home
• Non-recourse loan

Additional Information

Equity home loans are often used to fund home improvements, pay off debt, or cover unexpected expenses. They can provide a lower-interest alternative to credit card debt and other types of loans. However, they may also come with closing costs, origination fees, and other expenses. Homeowners should carefully consider their financial situation and goals before taking out an equity home loan.

The amount you can borrow through an equity home loan will depend on the value of your property, the amount of equity you have built up, and your creditworthiness. It’s essential to work with a reputable lender and to thoroughly review the terms of the loan before signing.

Equity home loans can be repaid over a fixed period, usually 5-30 years, and may offer tax benefits and other incentives. However, homeowners should be aware that missing payments can result in foreclosure, so it’s crucial to carefully manage the loan and make regular payments.

Etymology

The term “equity” comes from the Latin word “aequitas,” meaning fairness or justice. In the context of finance, equity refers to the value of ownership or the benefit that a person or entity derives from an asset.

Usage Notes

Equity home loans are commonly used in the context of real estate and personal finance. When discussing an equity home loan, it’s essential to clearly define the terms and conditions of the loan, including the interest rate, repayment period, and any fees associated with the loan.

Cultural References

Equity home loans are often referenced in popular culture, particularly in TV shows and movies that focus on personal finance and real estate. For example, the financial sitcom “Schitt’s Creek” features a character who takes out an equity home loan to finance her home renovation project.

Idiomatic Expressions or Phrases

There are no idiomatic expressions or phrases that directly involve the term “equity home loan.” However, the phrase “using the equity in your home” is often used to refer to the process of borrowing against the value of one’s property.

Related Words or Phrases

Some related words and phrases that are closely related to “equity home loan” include:

• Home equity
• Mortgage
• Loan
• Collateral
• Interest rate

Collocations

Some common collocations with “equity home loan” include:

• Take out an equity home loan
• Use the equity in your home
• Refinance with an equity home loan
• Pay off debt with an equity home loan

Frequency of Use

Equity home loans are commonly used in personal finance and real estate, particularly in North America and Europe. According to a survey by the Federal Reserve, in 2020, approximately 12% of US households had taken out an equity home loan to finance their home renovation projects.

Common Misspellings

Some common misspellings of “equity home loan” include:

• Equity homeloan
• Equity homeloon
• Equity home loin