Understanding Home Equity Line of Credit

Mudit Buying

A secured line of credit is essentially a low-interest loan that a financial institution offers you against your investments as collateral, generally your own Real Estate property or Guaranteed Investment certificates, etc. Since your owned asset backs the line of credit, it has a relatively lower interest rate and higher credit limit. The lender has a safety net that they can acquire and freeze the asset if the borrower does not pay the debt on agreed terms. They can go for power of sale of the property to recover their funds. The terms are generally better on Secured lines of …