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In addition, you also receive the benefits of a tax deduction
on financing secured by your home. There are several types of
loans homeowners can consider tapping into. The first is the home
equity line of credit and is as the name implies an open line
of credit which funds can be drawn and repaid as needed. This
loan has a variable rate, typically tied to the prime rate index
with a margin on top of the index that is based upon the homeowner’s
credit rating. The nice feature of this loan is that it is great
if you have a stream of purchases to make and that you pay interest
only on the funds which are borrowed, not on the credit line maximum,
unless you draw funds up to the line’s max. The second type
of equity loan is the traditional second mortgage. This loan is
good for fixed purchases, when you know precisely how much money
you will need, and want a fixed rate and a regular payment schedule
upon which to repay the loan.
Auto Dealerships
Increased competition has made dealer financing an option worthy
of serious consideration. And in today’s competitive environment,
dealers may earn more of their profit on auto financing than they
do on actual vehicle sales. The dealer may offer a rate lower
than that of banks or credit unions because of volume discounts
they generate in automotive lending. Therefore a dealer who places
a large chunk of business with a particular lending institution
may be able to swing a better deal with a lender than you could
obtain on your own.
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