A Home Equity Loan uses the equity that you have in your home to provide funds which you can use for any purpose. Some examples of uses for equity funds are:
- Pay off credit card debt
- College tuition
- Unexpected medical/dental bills
- Debt consolidation
- Vacation
But what is equity exactly? Equity is the difference between what you owe on your first mortgage and the market or appraised value of your home. If your home is valued at $100,000 and you owe $63,000, the equity is the difference or $37,000.