Imagine that you and your spouse have a baby on the way. You weren’t planning to start a family quite this soon and your home reflects that. The two bedroom one bath bungalow seemed like a perfect starter home for two people, but now it feels too small to include a third. You love this house, so you want to make it work. The lot’s big enough to add on an extra room - the nursery. You can just knock out the back bedroom wall and go from there. Or, maybe you could enlarge the kitchen while you’re at it, tack on a half bath and the nursery. That would be great. But where will you get the money to pay for the renovation?
In this article we’ll look at what it means to borrow against the equity of your home, what the various types of home equity loans are, and when it may be the right time to get one.
In the next section we will take a look at some of the basics.