Home Equity Loan To Build

Expert, localized Los Angeles answers provided by Heather Roy

Home Equity Loan To Build
	Dear Ms. Lank, My husband and I plan to purchase a home site on which to build. While it is being built we wish to continue living in our current home. Would it be wise to use a home equity loan to purchase the site? Would you please explain how to go about this and how the home equity loan would or could evolve into our new mortgage?

	A home equity loan is really a form of second mortgage, placed as a claim against your present home. It must be paid off, along with your first mortgage, when you sell.Sometimes you can obtain a construction loan for your new building, which converts to a regular mortgage when the house is finished. You can talk with a mortgage broker, or perhaps the contractor with whom you deal will have some suggestions.
	Edith Originally published on July 6, 2006

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