Tips for Borrowers

Borrowers should always make sure that they do not overlook the prepayment penalty. These may be very expensive, and the borrower might need to sell a property or refinance, so it is important that borrowers should know how much it will cost him.

Another thing borrower should understand is the life-cap maximum. Before applying for an equity line of credit, it is important that the borrower is aware if and how much the interest rate will fluctuate in the future.

Borrowers should not get a high credit limit even if he can easily get a large credit line. It is wise to take into consideration how much the borrower really needs and get that amount because high credit lines will have a negative effect on his chance to get another credit in the future.