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How much can you save by shopping for a home equity loan?
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When the Federal Reserve met earlier this month, it once again held interest rates steady at a 23-year high due to persistent inflation and other economic factors. The decision marks the seventh consecutive meeting in which the Fed paused the federal funds rate at its current 5.25% to 5.50% range.
However, certain types of consumer borrowing rates, which tend to rise and fall in line with Fed decisions, have ticked lower for the past four weeks, perhaps in anticipation of potential rate cuts projected by many economists that are expected to occur later in the year. And that’s good news for homeowners in need of cash — as they may be able to tap into their home’s equity by borrowing money at a lower rate.
The average home equity loan interest rates stand at 8.60% currently (as of June 27, 2024). However, there are lenders offering much lower home equity borrowing rates for creditworthy borrowers. That’s why it’s a good idea to shop around and get quotes from multiple home equity loan and home equity line of credit (HELOC) lenders. By doing so, you may be able to find the best combination of low interest rates with minimal fees and closing costs.
Find out your top home equity borrowing options online now.
How much can you save by shopping for a home equity loan?
“A homeowner could potentially save thousands of dollars in interest over the life of a loan by shopping around for several different home equity loan options,” says Faron Daugs, founder and CEO at Harrison Wallace Financial Group. Daugs recommends considering not only brick-and-mortar banks but also online banks and credit unions during your search.
By casting a wide net with numerous lenders, you’re likely to see a broad range of rates and terms. And, keep in mind that even a small rate difference can lead to significant savings over time.
“Savings will depend on the life of the loan, interest rate and any origination fees. For example, a 1% difference over the 10-year life of a $100,000 loan could save you almost $6,000 in interest,” Daugs says.
If interest rates continue their recent downward trend, it could also lead to lower loan costs. Home equity loans come with a fixed interest rate, so locking in a lower rate now might give you a more affordable loan than you would have received a month ago.
However, if you believe rates will continue to drop, you may want to wait before applying for a home equity loan.
Alternatively, you might consider a HELOC, which typically has a variable rate, allowing you to capitalize on any future rate drops. Of course, rates can also rise at any time, which could be likely if you have a longer-term line of credit — so make sure you know the risks of this type of borrowing before you make a decision.
Another benefit of getting multiple quotes is that you can use the competition to secure the best deal. When speaking with a potential lender, don’t hesitate to mention any offers you’ve received for lower rates or reduced closing costs.
In fact, you should be ready to talk about your credit score, current market rates and offers you’ve received from other lenders, says Saddat Abid, CEO at Property Saviour.
“With that knowledge, borrowers can confidently walk up to lenders and bargain for lower interest rates, lower fees and more friendlier payment conditions,” Abid says. “If you have a good credit score, coupled with a sound history of repayment, you can use them to your advantage and try to negotiate for a lower rate of interest.”
Working with a mortgage broker is one way to save time while shopping for lenders.
“A mortgage broker can be an excellent resource in this instance as they are able to share many different lenders offerings and are not married to just one product at one bank,” Sarah Alvarez, vice president of mortgage banking at William Raveis Mortgage, says.
Learn more about the home equity borrowing rates you could qualify for here.
Is this a good time to take out a home equity loan?
Whether you should take out a home equity loan now is a personal decision based on your unique situation. That said, a home equity loan could be beneficial if you need funds for emergency expenses or home improvements.
After all, even in today’s high-rate environment, home equity loan options usually have rates that are lower than the rates on credit cards and personal loans. And, according to the IRS, you may be allowed to deduct your home equity loan interest if you use the loan funds to “buy, build, or substantially improve your home.”
As with any financial product, though, it’s essential to consider the downsides. The biggest drawback of home equity loans is that they use your home as collateral. If you miss payments or default on the loan, you could lose your home to foreclosure.
And, when shopping for a loan, make sure to look at more than just the interest rate. For example, be sure to compare the annual percentage rates (APRs). This figure reflects the “true cost” of borrowing and represents the loan’s interest rate plus any additional points, fees and other charges that come with it.
If you decide you want to proceed with a home equity loan, start by getting your credit score and determining how much you want to borrow and for how long. It’s also a good idea to research today’s best rates on home equity loans.
NEW YORK — Drones have been banned from flying over several New Jersey towns, the Federal Aviation Administration confirms to CBS News.
The FAA order covers nearly two dozen towns, including Jersey City, Harrison, Edison, Bayonne and Camden. It will be in effect until Jan. 17.
The order says no unmanned aircraft can operate below 400 feet within one nautical mile of the airspace specified in each area. Additionally, it allows the government to use “deadly force” against the drones if they pose an “imminent security threat.”
“Pilots of aircraft that do not adhere to the procedures in the national security requirements for aircraft operations contained in this section may be intercepted, and/or detained and interviewed by federal, state, or local law enforcement or other government personnel,” the order reads in part.
Several of the zones are centered around infrastructure, like power substations. Others cover areas like the Kearny, New Jersey port and airspace around military installations like Joint Base McGuire-Dix-Lakehurst in South Jersey, or airports such as Newark-Liberty International Airport.
Earlier this month, the Florham Park, New Jersey police chief told residents drone sightings had been reported above “water reservoirs, electric transmission lines, rail stations, police departments, and military installations.”
Where are drones banned in New Jersey?
North Jersey:
- Cedar Grove
- Bridgewater
- North Brunswick
- Metuchen
- South Brunswick
- Edison
- Branchburg
- Sewaren
- Jersey City
- Harrison, Essex County
- Elizabeth
- Bayonne
- Clifton
- Kearny
Central Jersey:
South Jersey:
- Burlington
- Evesham
- Camden
- Gloucester City
- Westampton
- Winslow
- Hancocks Bridge, Salem County
See the full order from the FAA here.
Mysterious drones over New Jersey and beyond
Drones sightings have been reported all month long, first over Morris County, New Jersey and then over several other East Coast states.
Federal, state and local officials have been demanding more information about where they are coming from and what’s being done to stop them. The FBI is leading the investigation and tells CBS News it has received thousands of tips.
While the White House says there is no known threat, New Jersey Gov. Phil Murphy recently sent a letter to President Joe Biden asking for more federal resources.
On Wednesday, a push from Sen. Chuck Schumer to give local law enforcement more ways to track drones was blocked in the Senate.
Check back soon for the latest updates on this developing story.
contributed to this report.
Two highway crashes in southeastern Afghanistan killed a combined total of 50 people and injured 76, a government spokesman said Thursday.
One was a collision between a bus and an oil tanker on the Kabul-Kandahar highway late Wednesday, said Hafiz Omar, a spokesman for the governor of Ghazni province.
The other, also late Wednesday and in the same province, was in a different area of the same highway, which connects the Afghan capital with the south.
MOHAMMAD FAISAL NAWEED / AFP via Getty Images
Hamidullah Nisar, the provincial head of the Taliban-run Information and Culture Department, told the Reuters news agency the other accident involved a cargo truck, adding that some of those injured in both collisions were in critical condition.
Omar said many of the injured were taken to hospitals in Ghazni and patients in more serious condition were transferred to Kabul. Women and children were among the casualties, he said.
Authorities were in the process of handing over the bodies to families, Omar said.
MOHAMMAD FAISAL NAWEED / AFP via Getty Images
Crash survivor Abdullah Khan, who was being treated in a Ghazni hospital, said he didn’t know how many people had either died or were injured.
“I got out from the bus myself and heard the sound of moaning. There was blood everywhere. Some people had head injuries and others had hurt their legs.”
MOHAMMAD FAISAL NAWEED / AFP via Getty Images
Traffic accidents are common in Afghanistan, mainly due to poor road conditions and driver carelessness.
MOHAMMAD FAISAL NAWEED / AFP via Getty Images
CBS News
France’s President Emmanuel Macron tours cyclone-battered Mayotte, meets survivors pleading for help
Mamoudzou, Mayotte — France’s President Emmanuel Macron traveled Thursday to the Indian Ocean archipelago of Mayotte to survey the devastation that Cyclone Chido wrought across the French territory as thousands of people tried to cope without bare essentials such as water or electricity.
“Mayotte is demolished,” an airport security agent told Macron as soon as he stepped off the plane.
The security agent, Assane Haloi, said her family members, including small children, are without water or electricity and have nowhere to go after the strongest cyclone in nearly a century ripped through the French territory of Mayotte off the coast of Africa on Saturday.
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“There’s no roof, there’s nothing. No water, no food, no electricity. We can’t even shelter, we are all wet with our children covering ourselves with whatever we have so that we can sleep,” she said, asking for emergency aid.
Macron got a helicopter tour of the damage and was to spend Thursday night on the far-flung French territory. After flying over the destruction, he headed to the hospital in Mamoudzou, Mayotte’s capital, to meet medical staff and patients.
Wearing a traditional Mayotte scarf on his white shirt and tie, sleeves rolled to the elbows, the French president listened to people asking for help. A member of the medical staff told him some people hadn’t had a drink of water for 48 hours.
Some residents also expressed agony at not knowing about those who have died or are still missing, partly because of the Muslim practice of burying the dead within 24 hours.
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“We’re dealing with open-air mass graves,” Mayotte lawmaker Estelle Youssoufa told reporters. “There are no rescuers, no one has come to recover the buried bodies.”
Some survivors and aid groups have described hasty burials and the stench of bodies.
Macron acknowledged that many who died hadn’t been reported. He said phone services will be repaired “in the coming days” so that people can report their missing loved ones.
French authorities have said at least 31 people died and more than 1,500 people were injured, more than 200 critically. But it’s feared hundreds or even thousands of people have died in total.
Abdou Houmadou, 27, said emergency aid was needed immediately, not Macron’s presence.
“Mr. President, what I’d like to tell you… is I think the spending you made from Paris to Mayotte would have been better spent to help the people,” he said.
Another resident, Ahamadi Mohammed, said Macron’s visit “is a good thing because he’ll be able to see by himself the damage.”
“I think that we’ll then get significant aid to try and get the island back on its feet,” the 58-year-old said.
LUDOVIC MARIN/POOL/AFP/Getty
Macron’s office said four tons of food and medical aid, as well as additional rescuers, were aboard the president’s flight. A navy ship was due to arrive in Mayotte on Thursday with another 180 tons of aid and equipment, according to the French military.
People living in a large slum on the outskirts of Mamoudzou were some of the hardest hit by the cyclone. Many lost their houses, some lost friends.
Nassirou Hamidouni sheltered in his house when the cyclone hit.
His neighbor was killed when his house collapsed on him and his six children. Hamidouni and others dug through the rubble to reach them.
The 28-year-old father of five is now trying to rebuild his own house, which was also destroyed.
He believes the death toll is much higher than what’s officially being reported, given the severity of what he lived through.
“It was very hard,” he said.
Mayotte, located in the Indian Ocean between mainland Africa’s east coast and northern Madagascar, is France’s poorest territory.
The cyclone devastated entire neighborhoods and many people ignored the warnings, thinking the storm wouldn’t be so extreme.
Mayotte has more than 320,000 residents according to the French government. Most are Muslim and French authorities have estimated another 100,000 migrants live there.
Mayotte is the only part of the Comoros archipelago that voted to remain a part of France in a 1974 referendum.
Over the last decade, the French territory has seen a massive influx of migrants from the neighboring islands – the independent nation of Comoros, which is one of the world’s poorest countries.
