What is a Mortgage?

A mortgage is an agreement between you and a lender that gives the lender the right to take your property if you fail to repay the money you've borrowed plus interest. Mortgage loans are used to buy a home or to borrow money against the value of a home you already own.

First Mortgage Loans

We offer Fixed-Rate Mortgages at competitive rates and we can help you find the right mortgage loan option for your specific needs. We also offer refinanc- ing for your current mortgage to save you money.

• 15 Year Fixed-Rate Mortgage Loans
• 20 Year Fixed-Rate Mortgage Loans
• 30 Year Fixed-Rate Mortgage Loans

Home Equity Loans

Home Equity Loans are available for homeowners who desire low-cost financing for a variety of reasons. We offer Fixed Rate Closed-End Loans as well as Variable Rate Open-End Line of Credit Loans.

How Our Home Equity Line of Credit Works

A home equity line of credit is a variable rate line of credit that uses your primary residence or rental property as collateral, or security for the debt. This variable rate features interest and principal payments that can change over time. While rates may change daily, you'll have a specific rate cap, which limits how much your rate can change over the life of your line of credit.

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Understanding Timing: Borrowing vs. Repaying

A home equity line of credit includes a draw period of up to 5 years during which you can borrow as much or as little as you need (within your credit limit), whenever you need it. The minimum payment required is an interest only for that 5 years period.

When your draw period ends, you enter the repayment period. This period can last up to 10 years during which you are expected to repay your outstanding balance. You'll no longer be able to borrow funds during this time.

Subject to Final credit approval and direct deposit with KH Credit Union. Actual rate based on credit history. Other terms and conditions may apply. See specic loan disclosures for each type of lein for details.

Mortgages and Home Equity Line-of-Credit Loans

The biggest difference between a mortgage and a home equity line of credit is:

• A Mortgage has only one purpose; buying a house.
• A Home Equity Loan is a loan you can use for many purposes using the equity in your home.

What is a Home Equity Line of Credit? (HELOC)

If you are in the market for credit, a home equity plan is one of several options that might be right for you. Before making a decision, however, you should weigh carefully the costs of a home equity line of credit against the benets Shop for the credit terms that best meet your borrowing needs without posing undue financial risks. And remember, failure to repay the amounts you've borrowed, plus interest, could mean the loss of your home.

A home equity line of credit is a form of revolving credit in which your home serves as collateral. Many homeowners use home equity credit lines only for major items, such as education, home improvements, or medical bills, and choose not to use them for day-to-day expenses.

With a home equity line, you will be approved for a specific amount of credit. Many lenders set the credit limit on a home equity line by taking a percentage (say, 75%) of the home's appraised value and subtracting from that the balance owed on the existing mortgage.

For example:

What is a debt-to-income ratio? Why is the 43% debt-to-income ratio important?

To calculate your debt-to-income ratio, you add up all your monthly debt payments and divide them by your gross monthly income. Your gross monthly income is generally the amount of money you have earned before your taxes and other deductions are taken out. For example; Your debt-to-Income ratio is all your monthly debt payments divided by your gross monthly income. This number is one way lenders measure your ability to manage the payments you make every month to repay the money you have borrowed.

By clicking on our Mortgage Portal, you'll find answers to frequently asked questions (FAQs) along with rates, calculators and applications. You can also get a no-cost/no-obligation quote or pre-qualication.