By Rachel Popa, Content Marketing Specialist at GLCU
Michelle Collins, a retired banker, didn’t know how she was going to help The Leaders Network open a credit union in Chicago’s Austin neighborhood, but she was determined to make it happen. Despite being one of the largest neighborhoods in Chicago by population and geography, Austin has long been considered a financial services desert, meaning that its nearly 100,000 residents lack access to essential banking services.
Michelle, the daughter of a West Side pastor, grew up in Austin, worked in community development banking in the neighborhood for more than 30 years, and is passionate about financially empowering its residents. She first learned about The Leaders Network, a group of multicultural, interfaith, and community leaders, after the organization awarded her the Dr. Martin Luther King, Jr. Keeper of the Dream award in 2019.
The Leaders Network is dedicated to following Dr. King’s vision of creating a “beloved community,” and to establishing a better quality of life for marginalized groups living in Chicago’s West Side and beyond. After attending a meeting and seeing the work The Leaders Network is doing in the community, Michelle joined the organization as a strategic advisor, and was asked for her help to open a credit union in Austin.
Bringing the Credit Union Philosophy of “People Helping People” to Austin
Unlike large banks where customers are often treated like just like another number, credit unions are community-minded organizations that aim to build relationships with their members. This hands-on approach to community development, improving members’ financial well-being, and building relationships led to the decision to open a credit union in Austin.
“We’re going to initiate a new day and a new way of conducting financial transactions on the West Side,” said David Cherry, president of The Leaders Network. David has been a member of The Leaders Network since 2015 and has 35 years of experience as a community organizer. “Credit scores are only a part of a person’s life story when applying for credit. There are so many things which our credit union will take into account which banks won’t.”
After Michelle made some calls and met with others in the credit union industry, the Illinois Credit Union League introduced Michelle and The Leaders Network to Great Lakes Credit Union (GLCU), and the two organizations set their sights on bringing the first-ever credit union branch to the Austin neighborhood. After months of planning, construction, and hard work, the Leaders Network Financial branch of GLCU opened its doors on April 24th, 2024.
“For me, it’s really a dream come true,” Michelle said. “It’s a miracle that we can have a credit union…a real, fully-fledged financial institution right in the heart of Austin.”
“It’s going to be transformative and history making,” added David.
Banking for a Greater Good: Expanding Access to Financial Services
Before the Leaders Network Financial branch of GLCU opened, there was only one financial institution available to serve Austin’s residents. Because of the lack of financial institutions in the area, many people in Austin had to rely on currency exchanges and predatory payday lenders to get by.
“I remember stopping at the currency exchange that’s at Chicago and Cicero in the Austin community. I was standing there, and the person was counting out how much cash this person was about to receive. Just think – you’re cashing out two weeks’ worth of pay, and so you’re [getting] all that cash and taking it home,” David said. “There was so many robberies taking place at that Chicago and Cicero location, they actually put an armed security guard in the space. But the problem is that once you leave the space then people can still rob you when you’re walking down the street. It’s just such a terrible way for so many people to live.”
And without access to a checking or savings account, people often store cash at home or keep it in their wallet, where it’s easier to spend – and to lose, David said. These underbanked residents also miss out on taking advantage of interest-bearing accounts, and the protection and security a financial institution provides.
With the median household income in the Austin neighborhood sitting at $38,407, many can’t afford to pay for emergency expenses or put money into savings. As a result, some West Side residents turn to predatory payday lenders to cover bills and emergency expenses. Payday lenders charge exorbitant interest rates, which leads to people paying back much more than what they borrowed. This contributes to generational cycles of poverty, where people struggle to get ahead.
“By the time they finish paying off their [payday] loan they they’re so much in debt that they’re behind on their light bills, they’re behind on their rent,” David said. “It’s been an unmitigated disaster for people. Austin has been hit hard by these [payday lenders].”
Financially Empowering the Austin Community
The Leaders Network Financial branch of GLCU offers much-needed alternatives to currency exchanges and payday lenders. For example, the credit union offers affordable Fast Cash loans to help members cover emergency expenses, with approval for a loan based on the member’s relationship with the credit union, not their credit score.
Members can also take advantage of the credit union’s Credit Builder loan, which offers a no-cost opportunity to establish or improve their credit score. And with the credit union’s Fresh Checking account, members can build a positive financial history without a monthly balance requirement.
In addition to accounts and loans that help members get back on their feet, the credit union offers small business loans, mortgages, home equity lines of credit, interest-bearing checking accounts, share certificates, retirement accounts, savings accounts, and other essential financial services – paving the way for financial and economic empowerment in the Austin community. Free HUD-certified housing and financial counseling is also available to both members and non-members in the community.
“I believe that financial literacy [and] the access to capital to make improvements will uplift the community,” Michelle said. “When you’re investing in your home or becoming an owner where you can become an investor, the equity that you’re building is wealth building for the community.”
“[We’re] that first step, that seed that’s planted to show them how to save,” said Reggie Little, a business development specialist at GLCU. Reggie started his banking career in Austin in 1985 and played a key role in opening the Leaders Network Financial branch of GLCU. “With us lowering the bar to a dollar to open up a savings account [or] CD, just knowing that you have a CD can give someone a sense of pride. Of course, you can grow that CD as time goes by, but we’re helping them take those baby steps.”
By prioritizing the needs of those who have been underserved and breaking generational cycles of poverty, Leaders Network Financial and GLCU are ushering in a new era of opportunity for the Austin community and beyond.
“Fortunately, I had financial education growing up. I’m in a position to not only help myself but help others who may not have had that experience. So, I can now let people in the Austin community know that there’s options for them,” said Cedric Collins, assistant branch manager for the Leaders Network Financial branch of GLCU. Cedric is Michelle’s son and has spent a lot of time in the Austin community as well over the course of his life. He has a background in retail management and said he’s looking forward to following his mother’s footsteps in the financial industry.
Building a Better Future Together
Now that the branch is open, Michelle, David, and the branch staff are looking forward to seeing the impact it will have on the Austin community and beyond moving forward.
“As we continue into 2024 and 2025, there’s going to be so many opportunities to reach out to the churches and to other groups,” David said. “The goal for all of us is to transform Austin.”
The Leaders Network Financial branch of GLCU aims to bridge the wealth gap, help West Side residents build generational wealth, and enact positive change in Austin and surrounding areas.
“I’m excited to help the underserved,” said Beatriz Hernandez, the senior branch manager for the Leaders Network Financial branch of GLCU. “I think that’s very important, especially in this community. Those individuals that have been using our ATMs have expressed so much gratitude – just being able to have an ATM where they don’t have to drive far away. That is one of the most important things I’m seeing.”
“It’s long overdue. I’m excited to serve the community,” Cedric added.
“What happens in Austin is important to not just people that live in Austin. If you live in Oak Park, if you live in River Forest, if you live in Maywood – we’re all in this fishbowl together,” Michelle said.
Excited to return to the neighborhood where he started his career, Reggie added, “I really love Austin. I have high hopes and dreams for this community. I would love to see it become the next Lincoln Park or Jefferson Park or Wicker Park. We have the ability.”
Together, Leaders Network Financial and GLCU are working to build a stronger, more financially secure community on the West Side. The Leaders Network Financial branch of GLCU may be the first credit union to open its doors in the Austin neighborhood, but the goal is for it to not be the last.
“Let’s make Austin this shining example of what is possible,” David said.
Learn more about Leaders Network Financial and GLCU’s mission to increase access to financial services in Austin and surrounding communities and apply to become a member today.
Carol had been renting a small, overpriced apartment in the Uptown area of Chicago for more than 15 years. While she enjoyed her space, she felt a growing need to follow the American dream of becoming a homeowner. Realizing the importance of having a target, she established a deadline to purchase a home by her 59th birthday in February 2024.
Like many first-time homebuyers, Carol was overwhelmed and didn’t know where to start. She began educating herself on the homebuying process and in August 2023, she registered for the GLCU Foundation for Financial Empowerment’s first-time homebuyer workshop. She learned about getting preapproved for a mortgage, understanding her credit score, eligibility requirements for mortgage assistance, and much more. Carol said the 6-hour webinar was, “very informative, and the speakers from the GLCU Foundation and the Realtors were empowering.”
With her confidence bolstered, Carol then consulted with Shevon Johnson, a Housing and Urban Development (HUD)-certified housing and financial counselor at the GLCU Foundation for Financial Empowerment. Under the guidance of Shevon, Carol realized that her credit score and budgeting skills were on par. Shevon then advised her of her debt-to-income ratio, and discussed what price range would be the best fit for Carol’s budget, with a monthly payment she could feel comfortable with.
During the homebuying process, Carol had a lot of questions. Helping Carol feel empowered was important to Shevon, and Carol felt reassured knowing that Shevon was there to assist her. “I had a number of one-off questions and Shevon was always helpful and informative,” Carol said. “When I asked her if I should buy a condo or a house, she suggested I attend one of the GLCU Foundation’s monthly online seminars about condo buying. This seminar was invaluable, and I was able to personally weigh the advantages and disadvantages of owning a condo and decide for myself.”
As she guided Carol through the homebuying process, Shevon helped Carol find a mortgage lender. After Carol was approved, Shevon discovered that Carol was eligible for assistance with the down payment. This assistance is specifically available to first-time homebuyers who qualify.
Thanks to the down payment assistance, Carol saved enough money for her closing costs and moving expenses. She reached her goal of homeownership with weeks to spare!
Carol closed on her 2-bedroom, 2-bath townhome in South suburban Richton Park at the end of January. “This is the ultimate birthday present,” she said. “I am extremely grateful for all the awesome assistance that Shevon and the GLCU Foundation provided to me. Your seminars really empowered me to take the next step in my journey and achieve my dream.”
If you or someone you know is in need of free financial and housing counseling assistance, don’t hesitate to reach out and schedule a free screening.
The information in this post is for educational and informational purposes only and does not constitute investment advice. You should consult a licensed financial advisor before investing in any financial product or service.
Glory and her husband Isaac moved from Nigeria to America in 1993. The couple rented an apartment next to GLCU’s Chicago Uptown branch, where Isaac took care of all the household finances.
After Isaac passed in the spring of 2020, Glory fell behind on her rent. Her property management company had a history of not communicating well with tenants, which didn’t help. On top of that, after not making any rent payments for a year, Glory fell victim to scammers, leaving her virtually destitute.
Once she understood she could be evicted, Glory made an appointment with the GLCU Foundation for Financial Empowerment. There, she met with John Borthwick, senior housing counselor. John helped Glory organize the necessary paperwork and even taught her how to access her email. Then, he helped her apply for the Illinois Rental Payment Program and tracked her application.
Throughout this time, John continued to help Glory navigate the application process, create an affordable budget with the income from her part time job, and talk about managing expenses once she was current on rent again.
Unfortunately, they soon found themselves hitting another roadblock. A payout error caused only $6,400 of Glory’s $8,200 balance to be paid in the summer of 2022. John tried to contact the Illinois Housing Development Authority and the property manager to fix the error, but once the payment had been received, they could not revisit the application.
Glory did her best to try and pay when she could, but the remaining balance kept growing and by the spring of 2023 she found herself in eviction court. John enlisted the help of Chicago Volunteer Legal Services to navigate court-based assistance but that too eventually led to a dead end based on eligibility. He kept looking up legal referrals and Glory continued to use any resource John provided to help her.
Thankfully, John’s tenacity paid off, and Glory eventually worked with Greater Chicago Legal Clinic to reach a settlement with her property manager, where she would pay a lump sum along with a little extra on her monthly rent. When she finally became current on her rent and shared the good news with John, she thanked him wholeheartedly, and said, “Since all of this trouble began, I’ve met different people that said they would try and help, but you are the only one that stuck with me through everything.”
Glory managed to get an extra shift at her job to meet the payments and is still working with John to make sure she is following the court order and managing her household budget. After fighting an uphill battle for two years together, they fondly refer to each other as a “good neighbor.”
If you or someone you know is in need of financial counseling assistance, you can learn more and schedule a free screening here.
How Rashawn Thomas worked with GLCU HUD-Certified Housing Counselors to avoid losing his home.
As temperatures plummeted to below-zero and a winter storm moved into Chicago, Rashawn Thomas was preparing to celebrate Christmas. He’d be celebrating in his home, which had not been a certainty until December 21, 2022.
On that date, Rashawn shared with his housing counselor, Wilane Boone, that he’d be receiving $60,000 in mortgage assistance that would enable him to avoid losing his home.
“I am so overjoyed and over-the-moon grateful! I don’t know how to thank you,” Rashawn wrote. “I am so very happy that my house has been saved. This is the best Christmas of my life!”
Facing Ballooning Payments and Bankruptcy
A few years prior, Rashawn had purchased the home with his life savings and later took out a Home Equity Line of Credit (HELOC) with his bank, where he was making on-time biweekly payments. When his bank merged with another financial institution that was unable to accommodate Rashawn’s payment schedule, his new loan was modified to include a balloon payment of $84,000 – a sum due within 6 months.
Unfortunately, Rashawn did not receive the proper disclosures detailing the total costs of the modification and was pressured to sign off on the modified loan without truly understanding the terms.
When the balloon payment came due, he fell behind, and filed for Chapter 13 bankruptcy under the guidance of several attorneys.
Advocating for Affordability
Rashawn was introduced to Wilane Boone, a HUD-Certified Housing Counselor at Great Lakes Credit Union, by employees at the Illinois Homeowner Assistance Fund (ILHAF) after he failed to qualify for mortgage assistance.
“I made an appointment to meet with someone in person, and I’m so thankful it was Wilane,” Rashawn said. “I had been dealing with four so-called lawyers who claimed to be professionals in their fields, [and] all four attorneys failed to see the predatory nature and errors of the loan.”
“Instead, they forced me into bankruptcy to try and save my home,” Rashawn added.
Not Wilane. Upon review of Rashawn’s case, Wilane uncovered that the bank did not provide Rashawn with the proper disclosures. Additionally, since the amount due to the bank equaled the total cost of the loan, Rashawn did not qualify for the State’s Homeowner Assistance Fund.
Going Above and Beyond
Wilane spoke to Rashawn’s bank and advocated that they provide Rashawn a reinstatement figure representative of the debt owed before the balloon was due, which would allow Rashawn to qualify for the mortgage assistance fund and pay off his bank.
After Rashawn filed a complaint with the Consumer Financial Protection Bureau, the bank agreed to the resolution, and Wilane worked with the State Housing Authority to ensure Rashawn’s eligibility for ILHAF.
“When I met with Wilane, she was able to find the errors in the loan and identify it as predatory within 45 minutes,” recalled Rashawn. “She could have just ‘done her job,’ helped me to apply to ILHAF, and sent me out the door. Instead, she went above and beyond. She truly advocated for me and helped me navigate a new and complicated process. For that, I will be forever grateful!”
Rashawn’s foreclosure and bankruptcy are now dismissed. He has an affordable mortgage payment and is continuing to work with his counselor, Wilane, to improve his credit.
If you, or someone you know is in need of free financial counseling assistance, do not hesitate to visit us at https://www.glcu.org/education-and-housing-counseling/ and schedule a free screening.
For home buyers on a budget or who want some of the perks of apartment life, buying a condo is one option.
According to the Institute for Housing Studies at DePaul University, the majority of neighborhoods in Cook County have condos, with a higher concentration in urban areas with high property values. If you’re considering buying a condo, here are a few key things to consider.[1]
Lifestyle: Condos are often located in busy, urban areas. Additionally, shared walls can make it so that you can hear your neighbors at any time of the day or night, similar to an apartment. Increased interaction with your neighbors isn’t all bad, however.
Many condo communities offer regular social events, making it easier to get to know your neighbors. Having a group of neighbors so close by can also be a benefit in case of an emergency.
Affordability: Condos are often more affordable than single-family homes, particularly in urban areas or for first-time homebuyers. However, condos come with additional fees, called Homeowners’ Association (HOA) fees to offset the cost of shared maintenance. These fees are paid in addition to the mortgage. They are applied toward things like repairs, maintenance of amenities, and building updates. Condos have reserves to pay for large purchases. A condo with healthy reserves can indicate better financial health overall.
There is no firm rule, but prospective buyers can ask to see a reserve study, which details the size of the reserve and any recent repairs or larger capital expenditures. If a condo has insufficient reserves to cover projects, the board can level an assessment, which requires condo owners to pay an additional amount of HOA fees.
Privacy and Freedom: For those who value being able to decorate and renovate exactly how they want, a condo might not be the best choice. The HOA can dictate how members can renovate and decorate, whether they can have pets, and what kind of outdoor decorations they can display.
Noncompliance with the HOA’s terms, whether through nonpayment of HOA dues or through another breach, may result in fines or even legal judgments.
Amenities: Depending on the size, location, and price of the condo, many offer amenities like lawn care, weekly social events, snow removal, and even a pool. These can be an attractive perk for homeowners who would otherwise not be able to afford them.
Financial Management in Community: Being part of an HOA means that financial decisions are made with group input. The board of directors has a responsibility to act in the best interest of the HOA as a whole. The HOA should have a healthy budget and reserves, meeting at least four times per year. In addition to reviewing the budget and reserves, attending HOA meetings and talking to prospective neighbors are good ways to assess the financial and community health of the condo.
Condo ownership isn’t for everyone, but it can be ideal for those looking for an affordable option and a close-knit community. If you’re considering buying a condo or want to know more about homeownership options, our HUD-certified counselors are here to help. Contact us at 224-252-2620 or housing at glcu dot org.
[1] For further reading on aspects of condo ownership compared to owning a single-family home, see https://www.investopedia.com/articles/mortgages-real-estate/09/issues-purchasing-condo.asp
Do you want to buy a home but are worried that you do not have enough saved for the down payment? You’re in luck! If you are an Illinois resident, you may qualify for the myriad of down payment assistance programs offered through the State and local municipalities.
The Illinois Housing Development Authority, IHDA for short, offers down payment assistance in various tiers. The amounts range from $6,000 to $10,000. There are different repayment requirements for each amount listed. For example, the $6,000 down payment assistance amount is 4% of the home purchase price for a maximum of $6,000. You do not have to pay this back as it will be forgiven over a 10 year span as long as you remain in your home.[1] The $10,000 in down payment assistance covers 10% of the purchase for a maximum of $10,000. This assistance is paid back monthly over ten years at a 0% interest rate. IHDA has a list of participating lenders on their website.
The Federal Home Loan Bank of Chicago has two programs, Downpayment Plus & Downpayment Plus Advantage, that also offer down payment assistance. Downpayment Plus is a matching program that provides down payment and closing cost assistance for income-eligible homebuyers. The assistance is provided in the form of a forgivable grant paid on behalf of the borrower at the time the borrower closes on mortgage financing with a participating FHLBank Chicago member financial institution. Grants are forgiven on a monthly basis over a five-year retention period. Downpayment Plus Advantage is a similar program but assists income-eligible homebuyers participating in homeownership programs offered by nonprofit organizations that provide mortgage financing directly to the homebuyer; it is not a matching program. Nonprofit organizations providing direct first-mortgage financing, such as Habitat for Humanity or Neighborhood Housing Services, must partner with an FHLBank Chicago member financial institution to access DPP Advantage funds. Grants are forgiven on a monthly basis over a five-year retention period.[2] The maximum grant amount for both programs is $6,000.
Local organizations and counties also offer their own down payment assistance programs. The MMRP Purchase Assistance Grant provides up to $15,000 in down payment assistance for the purchase of a home in one of the City of Chicago’s 10 Micro Market Recovery Program (MMRP) Areas. This grant is available to low and moderate-income households earning up to 120% of the Area Median Income (AMI) for the Chicago Metropolitan Area.[3] It does require that you be a first-time homebuyer or not have owned a home in the previous 3 years. More information can be obtained by contacting Neighborhood Housing Services of Chicago.
Community Partners for Affordable Housing, CPAH, provides eligible Lake County, Illinois homebuyers with up to 5% of the purchase price to help with down payment and closing costs. Assistance is provided in the form of a 0%-interest deferred loan with no monthly payments, forgiven at a rate of 1/60th every month. Loan forgiveness begins 60 days after closing. The loan is fully forgiven after 5 years and 60 days in the home. Other eligibility factors require that you put down $1,000 or 1% of the purchase price, whichever is greater, and that you qualify for financing with a CPAH Participating Lender.[4]
Kane County, Illinois offers a First-Time Homebuyer Loan Program that provides up to $10,000 in down payment and/or closing-cost assistance to first-time homebuyers in the form of a zero-interest, deferred-payment loan. No interest accrues on the loan, and no payments are due until the home is sold, the title is transferred, or the home is no longer used as the homebuyer’s principal residence. Up to an additional $10,000 may be available if the home purchased is located within the city limits of St. Charles, under these same terms and conditions.[5] A nice perk with this program is that Kane County does not require First Mortgage Lenders to be pre-qualified. Homebuyers may work with a Lender of their choice to obtain their first mortgage.
There are down payment assistance opportunities in other counties and cities throughout Illinois from Madison County down south to Rockford up north. Madison County Community Development offers a 5-year forgivable loan, based on 80% of area median income or less, for closing costs and down payment. This loan, for up to $5,000, will be forgiven only after five full years’ occupancy. Homebuyers who receive funds must obtain one-on-one pre-purchase counseling from a HUD-certified agency. A list of agencies may be obtained from a participating lender.[6] The city of Rockford offers a Homebuyer Assistance Program that provides financial assistance to make the purchase of a home more affordable to income-eligible homebuyers. The city of Rockford determines the amount of financial assistance, up to a maximum of $14,999, based on the applicant’s income, debt, and anticipated mortgage. The homebuyer must live in the home from the time of purchase through the end of the forgivable loan; approximately 6 years.[7]
You may be wondering why there are so many down payment assistance programs available to homebuyers. The Community Reinvestment Act (CRA) of 1977 required federally regulated banks to make an effort to lend to low and moderate income clients in their service area. As a result, most of the larger federally regulated banks and mortgage lenders in our country have created CRA home loan programs.[8] Some of the programs mentioned above are the result of this initiative.
References:
[1] “IHDA Mortgage Program Directory.” IHDAmortgage.org, Illinois Housing Development Authority, www.ihdamortgage.org/program-directory.
[2] “Downpayment Plus Programs: FHLBank Chicago.” FHLBC.COM, Federal Home Loan Bank of Chicago, www.fhlbc.com/community-investment/downpayment-plus-programs.
[3] “Grants at Nhschicago dot org.” NHS Chicago, Neighborhood Housing Services of Chicago, www.nhschicago.org/purchase-assistance/mmrp-purchase-assistance-grant/.
[4] “Down Payment Assistance.” CPAH Down Payment Assistance, Community Partners for Affordable Housing, www.cpahousing.org/home-buying/down-payment-assistance/.
[5] “Pages – First-Time Homebuyer Program.” Kane County – Established January 16, 1836, Kane County Office of Community Reinvestment, www.countyofkane.org/Pages/ocr/firstTimeHomebuyer.aspx.
[6]Madison County HOMEbuyer Program, Madison County Community Development, www.co.madison.il.us/departments/community_development/homebuyer_program.php.
[7]Homebuyer Assistance Program, City of Rockford Community & Economic Development Department, cdn.rockfordil.gov/wp-content/uploads/2020/08/Homebuyer-Brochure-08.19.2020.pdf.
[8] “First-Time Home Buyer Loans – Conventional, CRA, FHA, HUD, USDA, State Bond and VA Loans.” CRA Home Loan Programs, First Home Advisor, 12 Mar. 2019, firsthomeadvisor.com/home/loans/.
Buying a home is typically the largest purchase that many Americans will make in their lifetimes—and most won’t own their home outright for 15 to 30 years, depending on their mortgage term. As you pay off your mortgage month by month, the percentage of property that you own increases. This is called “equity,” which Investopedia.com defines in real estate as the difference between the market value of the home and how much is still owed to the mortgage lending institution. When you need extra funds, it is possible to take out an equity loan against the value of your dwelling.
How much can you borrow?
When considering a home equity loan, it is important that you understand how much you can reasonably expect to borrow. Since the loan is based on the equity you have in your home, the house and the property’s fair market value must be determined first. While Kimberly Dawn Neumann of Realtor.com says that there is no special mathematical formula for determining fair market value, it is generally defined as the price your house would fetch if it was sold.
A licensed appraiser will look at your property and consider factors such as location, condition and size to quote a dollar amount. Once the fair market value is determined, the amount you still owe on your home is subtracted to determine how much equity you have. Investopedia.com explains that your lender will typically let you borrow between 80 and 90 percent of your home’s equity depending on your credit history.
What is a home equity loan used for?
If you are looking to borrow against the equity in your home, chances are that you need assistance in making another big purchase. Hal M. Bundrick, CFP, a NerdWallet.com columnist, certified financial planner and investment specialist, takes a harder stance and advises that you should only tap into the equity of your home for one of two reasons: the home needs significant repairs, such as a new air conditioner or water heater; or you want to upgrade your home in a way that increases its value. When it comes to the repairs or other maintenance expenses, those costs help to not only keep the value of your biggest investment stable, but could also increase its fair market value. Certain remodeling projects can do the same thing if the upgrades are chosen wisely for the appeal they will add to your home if you were to sell it.
If you are seriously considering applying for a home equity loan, remember that this is a piece of your home being put up as collateral for a loan. Investopedia.com points out that these loans typically have reasonable interest rates and might initially seem like a good way to pay off other high-interest debt, like that accrued from credit cards. However, if your home equity loan goes bad, you could lose your house quickly.
Before deciding whether or not a home equity loan is right for you, examine all of your options and consider speaking to a financial advisor.