Mortgage Discovery: Home Equity Loans and HELOCs Review

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Save money with no fees or closing costs

Discover

Discover

Editor’s score: (2.9/5)

Save money with no fees or closing costs

Discover

Editor’s score: (2.9/5)

  • Products offered:

    home equity loan

  • Home Equity Loan Terms:

    10 years, 15 years, 20 years, 30 years

  • HELOC terms:

    none

  • Maximum LTV:

    not specified

Take NextAdvisor

Strong Points

  • No origination fees or closing costs
  • Home Equity Loans Available in 48 States

Cons

  • Limited customer service options available
  • Home equity loans are not available in Iowa and Maryland
  • Do not provide HELOC

Conclusion

Discover, a financial services company known primarily for its credit cards, also offers home equity loans as part of its suite of banking products. Home equity loans are available in 48 states, but no lender offers a Home Equity Line of Credit (HELOC). For Discover home equity loans, available loan amounts range from $35,000 to $300,000. Lenders do not charge origination fees, application fees, assessment fees, and mortgage taxes.

You can apply for a home equity loan online or by phone through Discover. In total, the application process will take about six to eight weeks, according to the Discover website.

Discover broadly offers home equity loans and superior price transparency nationwide, but the lack of HELOC offerings could be a limiting factor for consumers looking for additional product options . Additionally, Discover offers limited customer service options. The only option for getting support is by phone, there is no face-to-face service or online options such as email or live chat.

editorial independence

As with all home equity loan and home equity credit line (HELOC) lender reviews, our analysis is not influenced by partnerships or advertising relationships. For more information on scoring methods, click here.

Discover Full Mortgage Reviews

Discover is credit card, Bank accountsWhen personal loanthis financial services company also offers home equity loan to qualified homeowners. With Discover, you can withdraw up to 90% of your assets (up to $300,000) in fixed rate home equity loans.No admission fee, assessment fee, or other fees closing costsHowever, the company does not provide it. Home Equity Line of Credit (HELOC) Offers fewer product options compared to other lenders.

Discover Mortgage: Home Equity Loan Products

Discover offers home equity loan $35,000 to $300,000 in 48 states. We do not offer loans in Iowa or Maryland.

Many lenders put limits on you, Loan to Value (CLTV) Ratio For 80%, Discover allows you to borrow up to 90% of the stock you own at home.

you must have minimum credit score Out of 620 people to qualify for a Discover home equity loan, according to lender’s websiteYou must have a credit score of 700 or above to take out a loan over $150,000.better than yours credit score However, Discover also considers other factors such as income and income. how much assets you have at your home.

When taking out a loan, you can choose between 10, 15, 20, and 30 year repayment terms.cover it all closing costsso don’t worry origination feeapplication fees, appraisal fees, or mortgage taxes.

However, if you decide to pay off your loan balance within 36 months, you may have to reimburse Discover for up to $500 of these closing costs, depending on where you live.

Discover offers nothing. Home Equity Line of Credit (HELOC) product.

Mortgage Discovery: Mortgage Rates and Fees Transparency

Discover offers excellent price transparency on top of that. home equity loan, clearly shares the APR range, repayment terms, and fees on their website. However, to get a personalized rate quote, you must submit your application. Discover does not clearly state whether there will be a charge for submitting this application. hard credit inquiry.

Some lenders explicitly state that they can prequalify for a home equity loan without strict credit checks. Giving lenders easy access to this information can help them make better borrowing decisions before doing a credit check.

When comparing loan options, keep in mind that the lowest interest rate is not always the most affordable loan. High closing costs and other fees may offset the savings from low interest rates. With a Discover Home Equity Loan, you don’t have to worry about closing costs on top of your borrowing costs.

Discover Your Mortgage Compared To Other Home Equity Lenders

Discover PNC Bank US bank
Do you offer HELOC? No Yes: Standard (Variable Rate) HELOCs and Fixed Rate HELOCs Yes: Standard (Variable Rate) HELOCs and Fixed Rate HELOCs
Do you offer home equity loans? Yes: 10, 15, 20, or 30 year term No Yes: for periods of up to 30 years
States available 48 states (not available in Iowa and Maryland) 44 states (not available in Alaska, Hawaii, Louisiana, Nevada, Mississippi, South Dakota) 47 states (not available in Texas, Delaware, South Carolina)
Loan amount range $35,000 – $300,000 $10,000 – $1,000,000 $15,000 – $750,000 (up to $1,000,000 for California properties)
HELOC Loan Terms none Repayment period 5 to 30 years (5 to 20 years for Tennessee) Lottery period of 10 years; repayment period undecided
Maximum LTV Loan Value Ratio (CLTV) 90% 89.9% (80% or 85% in some states) 80%

How to Get the Best Home Equity Loan or HELOC Rates

In addition to Discover, many other lenders offer home equity loan HELOCs for qualified homeowners. Here are some tips to help you find the right loan and lender.

Check out the products on offer

Before you take out a mortgage, make sure you understand the following: Difference between home equity loan and HELOCso that you can choose the right product for your needs.

a home equity loan We offer an upfront lump sum payment that is repaid in monthly installments at a fixed interest rate. Monthly payments are fixed and interest is paid on the entire balance from the date of loan commencement.

a HerlockOn the other hand, is a line of credit that can be withdrawn and paid off as and when required. You only pay interest on the amount you withdraw, not on the entire available credit line. HELOCs typically feature variable interest rates and variable monthly payments, but some lenders allow you to lock some or all of your outstanding balance at a fixed interest rate.

If you are borrowing to cover a fixed cost project, or debt consolidationOn the other hand, if you don’t know how much money you need in advance, HELOC gives you more flexibility. Home equity loans can also offer more peace of mind with fixed interest rates. This is beneficial in an environment of rising interest rates, such as the current one. You can narrow down the list of lenders by deciding what kind of loan you want.

buy multiple lenders

We recommend comparing offers from multiple lenders before taking out a loan. You can find a home equity loan or HELOC with the lowest interest rates and fees by shopping around. Some lenders make it easy to get a personalized rate quote online without impacting your credit score. can be obtained.

If a lender requires you to submit a full application before they can show you a loan offer, this could involve a tough credit check, which could drop your score by a few points.Multiple Lenders You can apply for a loan, but to protect your credit, limit your loan purchases to a 45-day window.According to credit bureaus Experiansimilar loan-related credit references within 45 days of each other are considered a single reference in the FICO credit scoring process.

Compare interest rates and fees

After receiving several loan offers, compare interest rates and fees to determine which loan is the most affordable.use loan calculator Estimate monthly payments and long-term borrowing costs. Keep in mind that the longer the repayment term, the more affordable your monthly bill will be, but the interest rate can be higher in the long run.

borrow as much as you need

you might be able Borrow up to 80% or 90% your home assets It’s available on most home equity loans and HELOCs, but that doesn’t mean you have to withdraw the full amount. Borrowing too much can lead to burdensome debt that is difficult to pay off. Because home equity loans and HELOCs are collateralized by your home, Foreclosure if you Default.

Calculate and check your monthly payment amount and payment term before signing a loan. Examine your budget to make sure you can reasonably afford to pay your loan and don’t have more debt than you can manage.

Also, make sure you have a plan for how you will use the borrowed funds. Even if you can make your monthly payments, borrowing more than you need will cost you more interest in the long run. If you don’t know how much you need and don’t need to apply for additional loans later, consider getting a HELOC. This allows you to continuously withdraw money from your line of credit while paying interest only for what you actually use. .

improve credit score

As with any kind of loan, the borrower good credit score Get the best rates on a Home Equity Loan or HELOC. Debt-to-income ratio, income, and other factors to make a loan appraisal. If your credit is below par, you may struggle to get favorable interest rates or may not qualify for a loan at all.

repayment of debts, timely payment of loans, and dispute the error Everything on your credit report can help improve your credit score.take time improve your credit It will help you get a better interest rate before applying and save money as a result. Some lenders can even apply for a home equity loan or his HELOC with a creditable co-guarantor. but, Make a loan with a joint guarantor It has its own risks and drawbacks to consider before signing the dotted line.

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