Home equity interest rates can be confusing for some people. In fact, if the wrong type of loan is taken out, homeowners can easily find themselves in financial trouble. With the current housing market mess, it is wise to understand how these interest rates work and how much they will cost you during the life of your loan.
The good news is that interest rates are a very helpful tool when homeowners are shopping for home equity loans. Of the many terms that are associated with home equity loans, APR is one of the most important. APR stands for Annual Percentage Rate.
It should be understood that you cannot compare the APR between a home equity line of credit and a home equity loan. These are two different types of loans and they behave differently.
Homeowners should also understand that an introductory rate is often used by lenders to get new business. If your loan has an introductory rate make sure you understand what the true rate will be once the first phase or introductory phase is over.
There is a difference between the standard interest rate and the annual percentage rate. The interest rate for home equity loans does not correctly tell you...
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