Homeowners sometimes utilize a financial product that is known as Home Equity Loans to get money from their houses. The bank says the leading bank in this loan type area is the one which has the largest number of customers, holding 20% of the market. Among them, First Citizens Bank is the one who stood out because it is a customer-oriented bank that offers very attractive products, one of which is loans. The bank has done a very good job in this article, providing not only the advantages and disadvantages but also the application process, and numerous related topics, and thus, no wonder, the bank is one of the best in this field.
Introduction to Home Equity Loans
Home Equity Loans are the loans that are given even after the bank has already lent the first mortgage. The flexibility that the borrowers have in using their home’s value as security for the loan is the primary reason. The remaining extent is the amount of money that could be given in the best case and would be the nominal difference between the current value and the price that is yet to be repaid on the primary mortgage. This worker suggests that homeowners should limit themselves to using the loan for the acquisition of large and significant goods or if they have recurring debts. A very good example would be using the loan for paying the tuition fees or for the inevitable case of getting sick and in need of medical attention.
First Citizens Bank
The First Citizens Bank is a privately-held bank and is one of the oldest and the biggest in the United States. The bank’s headquarters is situated in Raleigh, North Carolina. It is important to mention that it presents all the possible banking services, such as home loans, personal loans, business loans, and home equity products. Moreover, they have, with the help of customer service, grown their base, and it is clear that the very loyal customers they work with are those they have helped satisfy over the years. They are also achieving growth in their capacity and outreach to serve their clients more efficiently and possess the capability of expanding their services beyond this level.
First Citizens Bank’s Home Equity Loans
First Citizens Bank offers an array of home equity loans that will suit various financial needs. First Citizens Bank offers competitive rates of interest and terms that are flexible for its home equity loans, whether you are looking to redo your house, are in a position to combine high-interest debt, or have to cover education expenses; these loans are a good deal.
Types of Home Equity Loans
First Citizens Bank has two main types of home equity loans: Fixed-Rate Home Equity Loans and Home Equity Lines of Credit (HELOCs). Knowing the differences between these is very important when making a decision.
Fixed-Rate Home Equity Loan: This is a type of loan that gives a borrower a fixed amount of money that is payed back by the borrower over a certain period and the interest is also fixed. The rate of interest is not affected by the market fluctuations and is therefore constant for the whole life of the loan, thus giving the borrowers the security of knowing the interest rate of their loan for the whole period.
Home Equity Line of Credit (HELOC): HELOC is a type of loan which the borrower is given a maximum amount of the money in the account for the payments over a period and is used in the same way as a credit card and the interest rate is not constant.
Advantages of Home Equity Loans from First Citizens Bank
When borrowing a home equity loan from First Citizens Bank, you will receive the following advantages:
Low-Interest Rates: First Citizens Bank gives the best interest rates which offer the highest savings to a person compared to the market of the borrower over the borrowing period.
Flexible Loan Terms: The bank is happy to offer you the choice of a fixed interest rate or the option of credit line owing to home equity and this could have any payback periods that suit your financial issues of preference.
Tax Deductibility: Provided the use of money was for the enhancement of one’s dwelling only, home equity loan interest was still an IRS deductible subject.
No Application Fees: By and large, the First Citizens Bank of America is not going to put extra charges on the application process for home equity loans, this means the amount of money still to be repaid is smaller.
Borrowing Flexibility: The borrowers have the leeway either to take the entire amount of money in the form of a lump sum or get a line of credit (HELOC), or even a mixture of these, the decision is also based on their financial goals.
Eligibility Criteria for Home Equity Loans
To make sure that someone is eligible for a home equity loan from First Citizens Bank, a number of requirements must be met. The terms and conditions of the loan may vary depending on the specific loan type and the financial position of the borrower but here are the most common requirements:
Homeownership: The borrowers should be the legal owners of the house they are using as security for the loan.
Equity in the Home: For an individual to qualify for a home, they must own a part of equity which is enough to cover the property’s loan. The value of the home used to obtain the loan is generally 85% of the loan value plus the first mortgage payment.
Credit Score: To apply for a home equity loan, a credit score minimum that was achieved would be necessary. First Citizens Bank doesn’t specify any definite number, but typically, a score of 620 or better is needed to access better conditions for the deal.
The Process of the Application
The simple process of getting a home equity loan with First Citizens Bank can be gradually outlined by several focal points:
Pre-Application: Prior to the actual submission of the application, applicants may intend (if they so wish) to use online tools of First Citizens Bank to acquaint themselves with their credit limit and check the interest rates.
Loan/Application: For the, sole purpose of the loan, the borrower would have to provide personal, financial and property details, including the information about the home, which is used as collateral.
Credit Check: The bank verifies whether the borrower’s credit is in good standing through ICIC.
Property Appraisal: This is a situation where a property will need to be valued to ascertain whether it is indeed valuable and that the equity is enough.
Loan Approval
Depending on the eligibility of the borrower, the bank will either agree or refuse the loan application.
Loan Disbursement: Once the loan has been approved by the lender, the borrower can either take the entire amount at once or get it as a line of credit based on the terms of the loan.
Points to Remember When Applying for or considering a Home Equity Loan
Things to Think about When Deciding to Borrow Against Your Home
First Citizens Bank is a great choice if you have already found out that a home equity loan is the right move for you. However, there are several things that should not be forgotten, because they will not only cover the immediate payment, but they will also be in line with personal values and goals for the future. This can be verified, in case you would consider the following………
Interest Rates: An individual might find it a bit surprising that the act of getting a fixed-rate loan implies being secure in the rate for some time. However, HELOCs, as a financial product, wherein your ability to control your price-fixing has not however been taken away by the bank, have their variable rates increasing consistently over some time.
Repayment Terms
The repayment period of the home equity loan is somewhere in the street of 5 to 30 years depending on the borrower’s financial situation and ability to pay. In this case, the loan might be a bit cheaper, and the borrower can still repay it at his/her convenience.
Loan Fees
One very important issue that the loan applicant should first settle is whether First Citizens Bank provides a no-fee application or not. The new bank could be pulling a strong PR stunt by not announcing but levying the new fees on the unsuspecting customers.
Additive options in a home equity financing outlet, for example, in the form of an origination fee, or as in the present case, a prepayment penalty charge, can accelerate the emergence of adverse unintended effects in such a way that the same are also borne by the borrower, i.e. the existence of such costs outside. If you had an obligation to find and pay the origination fee, then you have indeed availed of the benefit of turning equity into cash.
However, every good thing has a bad side, and home equity loans are no exception. Prospective lenders should, therefore, be informed about the following risks:
Foreclosure Risk: Besides repayment default, another threat is that of foreclosure. In such a case, the order of the world would be reversed, and the bank would be the one taking your house instead of the other way around.
Interest Rate Increases (HELOCs): The rate on a HELOC loan is not directly related to the interest rate because it is like a revolving debt used not by buying goods and services, but to meet a certain financial shortfall. Thus, as a matter of fact, it is possible for the interest rate to rise, which leads to a greater amount of interest to be paid in each of your monthly installments.
Overborrowing: The availability of cash beyond one’s needs from a home equity line of credit facility can be enough to significantly impair one’s personal finances especially when living amidst the harsh abusive terms of corporate America. When one pulls the trigger of overborrowing there are a number of evident downsides such as more indebtedness and more expensive catered loans.
Comparing First Citizens Bank Home Equity Loans with other Lenders
If you are certain that you want to use a home equity loan, you should check all the different lenders that may provide you with the best deal. These are the key things to check and compare that are most important, between First Citizens Bank and the other lenders:
Interest Rates: Compare the interest rates in First Citizens Bank, with the rates of the others, to know which bank would be the best for you.
Loan Terms: Analyze the loan terms, for example, the paying-off time, and choose the lender whose terms are the best for you.
Customer Service
Although First Citizens Bank is customer-centric, one still has to check the reputation of customer service of other lenders.
What Makes First Citizens Bank Home Equity Loans Outstanding?
First Citizens Bank has ensured its customers of good financial health by offering them safe and easy moving solutions. Also, their home equity loans have proved to be one of the primary reasons besides other noted roles. Here are some of the considerations why borrowers would be persuaded to use First Citizens Bank:
Historical Standing: The bank customers at First Citizens Bank have unreserved trust in them over a century of existence, and the bank constitutes a stronghold in the community today.
Flexible-Loan Products: The traditional HELOC (Home Equity Line of Credit) or remittance in one portion, whichever you prefer, can be given to you by First Citizens, and all these services can be accessed through loans of both fixed rate and HELOC.
People-Oriented: First Citizens Bank intends to provide its customers with a positive loan experience, thus always staying human being the main approach to the process.
Home Equity Loans Help In Many Ways
One of the ways by which people can use home equity loans has been listed below:
Home Improvements: A homeowner can choose to use this type of loan to renovate, repair or upgrade their house. This move will not only give them a better living environment; they will also be in a position to sell their houses lucratively in the future.
Debt Consolidation: A borrower can take advantage of low–interest home equity loans to pay off high-interest debt in life. In the process, he/she will save money and make their finances less difficult to manage.
Education: In case there are any educational needs to be met, or if someone would like to pursue a higher level of education, a home equity loan could be a feasible choice as it is possible to use it to fund the education.
Medical Expenses: Apart from health insurance, a homeowner can also take loans against his house to seek medical attention in tyhe case of unparalled medical cases.
Conclusion
First Citizens Bank with its home equity loan programs, provides its customers with a great variety of home financing options. You can always go to First Citizens if you want a home remodeling loan, to get relief from your liabilities or pay up for your children’s tuition. First Citizens will then make available to you loans at very competitive interest rates and with much flexibility in terms of the agreement. Furthermore, just like all other loan products, it’s crucial to assess your financial situation and make sure that home equity borrowing is the most apropos manner. After you’ve looked at all the sides of the deal and know all the opportunities that exist, you can then make a decision and be able to carry through with the wishes you have for your future.