What is a home equity loan?
user
Home equity loans are a financial product that allows you to borrow against your home, up to a certain limit.  The interest rate is generally low, and the terms are fairly generous.
assistant
So they take your home as collateral?
user
It's a different sort of collateral than a mortgage is, it's much less like an investment.  And also the loan term is generally shorter.
assistant
So it is a good thing?
user
Yes!  It’s a really good thing.  If you own your home outright, you’re giving up your equity to get cash, so it’s not a very good financial decision, but it’s a pretty common decision because of the short-term benefits.
assistant
Thank you for the information.
user
You’re welcome.
assistant
What is a home equity loan?
user
Home equity loans are a financial product that allows you to borrow against your home, up to a certain limit.  The interest rate is generally low, and the terms are fairly generous.
assistant
So they take your home as collateral?
user
It's a different sort of collateral than a mortgage is, it's much less like an investment.  And also the loan term is generally shorter.
assistant
So it is a good thing?
user
Yes!  It’s a really good thing.  If you own your home outright, you’re giving up your equity to get cash, so it’s not a very good financial decision, but it’s a pretty common decision because of the short-term benefits.
assistant
Thank you for the information.
user
You’re very welcome.  If you have any other questions about home equity loans, just let me know.  If I’m not aware of the answer, I can look it up.
assistant
What is a home equity loan?