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Question about paying down a home equity loan
I asked DH and confused him  .
We took out money from our home equity and plan on paying back what we took within the next 2 weeks. It is a large sum of money so when I pay do I put the that money towards principal or do I just pay it like I normally do (I dont apply any extra money just the minimum payment and once I pay this portion we will still owe money)?
Does this make sense to anyone else?
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Posted 3/26/07 9:03 AM  |
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Long Island Weddings
Long Island's Largest Bridal Resource | Prudential Douglas Elliman Real Estate |
LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Question about paying down a home equity loan
I think you have an interest only. You would have to pay more towards principal in order to get it down.
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| Posted 3/26/07 9:11 AM |
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Re: Question about paying down a home equity loan
I have to look at the paperwork again and see if it is intrest only. I dont think it is though.
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| Posted 3/26/07 10:13 AM |
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aliwnec10
mom of 3 boys
Member since 4/06 11426 total posts
Name:
Ali
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Re: Question about paying down a home equity loan
You need to contact the bank itself and tell them you'd like the money applied towards the principle and when you send the check, put it in a letter as well.
Now... make sure that you won't be penialized for this. With some home equities... there are penalties to paying it off early, so you might want to check on that. 
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| Posted 3/26/07 10:36 AM |
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csorisi
My 2 LOVES
Member since 11/05 1984 total posts
Name:
Corinne
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Re: Question about paying down a home equity loan
What I would do is call the bank and ask for a payoff so that you know exactly how much you have to pay them. Sometimes there are additional fees that you need to pay such as closing the account. If you call them they will probably ask you when you want it good through so you know exactly what you need to send. In additoin they will send you the paperwork to close the line of credit.
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| Posted 3/26/07 11:18 AM |
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MrsBlueSash
Love my sailor
Member since 6/05 5793 total posts
Name:
Christian
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Re: Question about paying down a home equity loan
I though equity is a home was a loan based on appreciation, an extra loan, so how is there principle? I would think whatever you pay goes toward the entire amount, with interest based on the amount borrowed.
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| Posted 3/26/07 11:32 AM |
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MegZee
My bunny
Member since 5/06 8777 total posts
Name:
Meaghan
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Re: Question about paying down a home equity loan
Posted by MrsBlueSash
I though equity is a home was a loan based on appreciation, an extra loan, so how is there principle? I would think whatever you pay goes toward the entire amount, with interest based on the amount borrowed.
if its a home equity loan, principal payments are due monthly
if its a home equity line of credit, than you only pay interest.
definitely call your bank and ask for a payoff amount.
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| Posted 3/26/07 11:37 AM |
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ODonnell
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Member since 9/05 5983 total posts
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Re: Question about paying down a home equity loan
Posted by Meaghan729
Posted by MrsBlueSash
I though equity is a home was a loan based on appreciation, an extra loan, so how is there principle? I would think whatever you pay goes toward the entire amount, with interest based on the amount borrowed.
if its a home equity loan, principal payments are due monthly
if its a home equity line of credit, than you only pay interest.
definitely call your bank and ask for a payoff amount.
We have a HELOC and we pay principal and interest every month. That's the way the bank set it up without us even asking. We could have had interest only, but this works better for us -at least we're paying it down every month.
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| Posted 3/26/07 11:59 AM |
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MegZee
My bunny
Member since 5/06 8777 total posts
Name:
Meaghan
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Re: Question about paying down a home equity loan
Posted by ODonnell
Posted by Meaghan729
Posted by MrsBlueSash
I though equity is a home was a loan based on appreciation, an extra loan, so how is there principle? I would think whatever you pay goes toward the entire amount, with interest based on the amount borrowed.
if its a home equity loan, principal payments are due monthly
if its a home equity line of credit, than you only pay interest.
definitely call your bank and ask for a payoff amount.
We have a HELOC and we pay principal and interest every month. That's the way the bank set it up without us even asking. We could have had interest only, but this works better for us -at least we're paying it down every month.
ITA - thats the way to go, or you may never pay it back - but "traditionally" speaking the product is usually interest only. but you have the right plan of paying principal back each month.
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| Posted 3/26/07 12:02 PM |
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iwed2005
LIF Adult
Member since 3/06 1389 total posts
Name:
Julie
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Re: Question about paying down a home equity loan
send the paypment seperately and to the princpal only. if you send it with a regular payment they will automatically put it towards the interest.
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| Posted 3/26/07 2:01 PM |
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Re: Question about paying down a home equity loan
Thanks everyone
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| Posted 3/26/07 4:14 PM |
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