Frequently Asked Questions for a FlexEquity Line
1. How does a FlexEquity Line work?
A FlexEquity Line allows you to borrow against the equity in your home. Borrow as often as you wish up to your approved limit. $10,000.00 Minimum credit line.
2. What can you use it for?
Take advantage of the flexibility of the credit line. You can use it for almost any purpose including, taking that vacation you always wanted, improving your home, consolidating your debts, purchasing a vehicle and even tuition.
3. How can you access the funds?
Accessing your credit line is as easy as writing a check and we even give you your first box of checks FREE. You can also access the line by using the Telephone Teller, Web Teller, or by contacting an associate at the Credit Union for an advance.
4. Interest Rate
With rates as low as .25% below the prime rate, our low rates save you money. Borrowers opening new credit lines can choose either a 0.0% APR introductory rate for the first three months or for peace of mind you can choose a rate that is fixed for 5 years with an additional 2.0% added to your loan rate. The interest rate is tied to the prime rate reported in the Wall Street Journal plus a margin that is determined by the loan-to-value ratio. The rate is variable and can change quarterly. See a USUCCU loan officer or the Important Terms of our FlexEquity Line for more details.
5. What are the monthly payments?
Low monthly payments make it easy for you to budget. For the first ten years of the credit line the minimum monthly payments are the accrued interest. However, principal payments in any amount can be made at any time. After ten years, the minimum monthly payments are usually 1.5 percent of the outstanding balance on the last day of each month but not less than $100. See a USUCCU loan officer or the Important Terms of our FlexEquity Line for more details.
6. What fees are involved?
We save you money. At USUCCU, we pay for the closing costs for you and there are no setup fees.
7. How is the loan to value ratio figured?
To figure the equity in your home take your home's current market value on your county property tax valuation notice or appraisal, multiply the value by a maximum of 80% (loan-to-value ratio), then subtract the amount owed on your existing mortgage. The remaining balance would be the maximum amount you are eligible to borrow (subject to credit approval).
8. How is the property value determined?
We make the process quick and hassle free. At application we determine if we can use the county property tax notice to determine the value or if an appraisal is needed. Whenever possible the Credit Union will use your recent property tax notice and a drive by evaluation to determine value.
9. Tax Advantages
Depending on your specific situation, you may be allowed to deduct the interest. Check with your tax advisor.
10. Other Requirements
Hazard insurance will be required. Flood insurance may be required.