Prime minus .51% for the life of the loan!*
Need to fix up the house, want to take a vacation or maybe you’re looking for a way to pay for college? Do it all and more with a Home Equity Line of Credit from First Merchants Bank. Use your HELOC whenever and wherever MasterCard® is accepted with the Equity Access MasterCard® debit card.
Get more out of your home’s equity!
PRIME RATE MINUS .51%
FOR THE LIFE OF THE LOAN!*
Now with great low rates below prime for the entire life of the loan, there has never been a better time to get the most out of your home’s equity! Use a HELOC to:
- Fix up your home
- Pay for college
- Take a dream vacation
- Consolidate your debt
- And more!
Borrow the smart way.
Talk to one of our knowledgeable bankers today to discover why a HELOC is right for you.
- Flexible – Ideal for home improvements, college tuition, and more
- Affordable – Special pricing for the life of the loan with no closing costs
- Smart – The interest you pay may be tax-deductible
(Not to be construed as tax advice. Please consult your attorney or tax adviser)
Open a HELOC today!
Call 1.800.205.3464 or visit a banking center!
What is a Home Equity Line of Credit (HELOC)?
A HELOC is a credit line that is directly tied to your home’s equity, which is the portion of your home you own based on payments to your mortgage principal. A HELOC provides ongoing access to those funds, meaning you can use it all at once or in smaller increments over time. Monthly payments are based only on the portion of the line of credit you actually use. Plus, the interest you pay may be tax deductible (consult your tax adviser).
What do I need to know about a HELOC?
Here are some basic things to consider when evaluating if a HELOC is right for you:
- You must have lived in your home long enough to build equity.
- HELOCs are generally capped at 85 percent of your home’s maximum value.
- Your approval and rates are subject to income level, job security, credit history and home value.
- You will only have to make payments based on funds you use, not the full amount available.
- Your loan-to-value (LTV) ratio is a risk assessment calculation for home equity loans. The higher your LTV, the riskier your loan, which may lead to higher interest rates or loan insurance.
- Remember: In the event of a default, your home could become collateral in paying off the loan.
What's the difference between a Home Equity Loan and a Home Equity Line of Credit (HELOC)?
This can be confusing to most because both Home Equity Loans and Home Equity Lines of Credit share some similarities, such as:
- Both loans are secured by the equity the borrower owns in his/her home.
- Both loans may be referred to as a second mortgage.
- Both loans’ interest may be tax-deductible (consult your tax adviser).
Home Equity Loan
- A fixed amount of money based on your home’s equity over a fixed amount of time.
- A fixed rate of interest, typically.
- Single lump-sum dispersal with no option for the borrower to obtain additional funds.
Home Equity Line of Credit
- A revolving credit limit based on your home’s equity.
- The option to draw funds at any time, and multiple times, over a predefined time period.
- The ability to draw money as he/she needs it, in any increments.
- Funds that are instantly available for use again, as soon as the principal is repaid.
- A variable rate of interest that may fluctuate over the life of the loan.
What are approved uses of a Home Equity Loan or Home Equity Line of Credit (HELOC)?
In short, a Home Equity Loan or Home Equity Line of Credit are both very flexible and may be used for most any occasion, including:
- Home improvements (large and small)
- Debt consolidation
- College tuition and expenses
- New automobile
- Automobile refinance
- Recreational vehicles (boats, motorcycles, ATVs)
- Unexpected expenses - medical bills, new furnace, etc.
It's also worth noting that the interest you pay on a Home Equity Loan or Home Equity Line of Credit may be tax deductible (consult your tax adviser).
What does “loan to value” ratio mean, and how does it affect my Home Equity Loan or Home Equity Line of Credit (HELOC) rates?
Loan to value (LTV) is a ratio drawn by comparing the amount of money a homeowner owes on his/her first mortgage versus the home’s current appraised value. Borrowers with higher LTVs usually pay a bit higher rates of interest because they are generally seen as a higher risk than those with comparatively lower LTVs.
LTV is typically calculated as:
LTV = Mortgage Amount / Appraised Property Value
How can I access my Home Equity Line of Credit funds?
There are multiple ways in which bank customers may access their Home Equity Line of Credit funds.
- Equity Access Card - Funds may be accessed via debit card transaction, using the Equity Access card associated with your HELOC.
- Online - Simply log in to your online banking account and easily transfer money from your Home Equity Line of Credit directly into your checking or savings account.
- Phone - Customers may call the bank to request that available funds be transferred into your checking or savings account.
How many times may I access my Home Equity Line of Credit funds?
In short, customers have unlimited access up to their approved credit limit.
* Home Equity Line of Credit (HELOC) rates are variable and subject to change based on published fluctuations in the Wall Street Journal Prime Rate. For initial advances of $50,000 or more (for new loan balances) the rate is PRIME minus .51%, and for initial advances of $25,000 to $49,999 (for new loan balances) the rate is PRIME minus .26% for the life of the loan. Current PRIME Rate effective July 1, 2016 is 3.50%. Maximum APR is 25%. To receive this offer, loan to value must be 80% or less with a credit score of 700 and above. Homeowners insurance is required. Owner occupied properties only. Offer valid on applications received on or before September 30, 2016. Annual fee of $75 is waived the first year. Normal credit underwriting standards apply. Refinance of existing FMB HELOC requires minimum increase of credit line by $10,000.
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