OluwatobiIf you are a homeowner and need some extra cash to pay for a home improvement project, consolidate debt, or cover an emergency expense, you may be interested in getting a home equity loan or a home equity line of credit (HELOC). These are types of loans that allow you to borrow money using the equity in your home as collateral. Equity is the difference between the current market value of your home and the amount you owe on your mortgage. The more equity you have, the more you can borrow.
But where can you get a home equity loan or a HELOC? If you are a member of USAA, a financial services company that serves military members and their families, you may be wondering if USAA offers these products. The answer is no. USAA does not offer home equity loans or HELOCs. However, USAA does offer other types of loans that can help you achieve your financial goals. In this guide, we will explain why USAA does not offer home equity loans or HELOCs, what alternatives USAA offers, and what other options you have if you want to get a home equity loan or a HELOC.
Why Does USAA not Offer Home Equity Loans or HELOCs?
USAA used to offer home equity loans and HELOCs until 2019, when it discontinued these products due to market conditions and customer feedback. According to USAA’s website, “USAA is no longer accepting new applications for Home Equity Lines of Credit (HELOCs), so we can focus on our other home loan products.” USAA also stated that “Home Equity Lines of Credit are complex products that require significant resources to support.” Therefore, USAA decided to stop offering these products and focus on its core products and services.
However, if you already have a home equity loan or a HELOC with USAA, you can still access your account and make payments online or by phone. You can also contact USAA’s customer service if you have any questions or issues with your existing loan.
What Alternatives Does USAA Offer?
If you are looking for a way to borrow money from USAA using your home as collateral, you may consider getting a mortgage refinance loan. A mortgage refinance loan is a type of loan that allows you to replace your existing mortgage with a new one that has different terms and conditions. You can use a mortgage refinance loan to lower your interest rate, change your loan term, switch from a fixed-rate to an adjustable-rate mortgage, or vice versa.
You can also use a mortgage refinance loan to cash out some of the equity in your home. This means that you can borrow more than what you owe on your current mortgage and receive the difference in cash. You can use this cash for any purpose, such as paying for home improvements, consolidating debt, or covering an emergency expense.
USAA offers various types of mortgage refinance loans, such as:
- Conventional refinance loan: A conventional loan is a loan that is not insured or guaranteed by the federal government. A conventional refinance loan may be right for you if you have good credit and income and want to lower your interest rate or change your loan term.
- VA Interest Rate Reduction Refinance Loan (IRRRL): A VA IRRRL is a loan that is backed by the Department of Veterans Affairs (VA) and is available to eligible veterans, service members, and surviving spouses who already have a VA loan. A VA IRRRL may be right for you if you want to lower your interest rate or shorten your loan term without getting cash back at closing.
- VA Cash-out Refinance Loan: A VA Cash-out refinance loan is also backed by the VA and is available to eligible veterans, service members, and surviving spouses who want to trade their home’s equity for cash. A VA Cash-out refinance loan may be right for you if you want to access some of the equity in your home and use it for any purpose.
- Jumbo Refinance Loan: A jumbo loan is a loan that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac, which are government-sponsored enterprises that buy and sell mortgages. In 2021, the conforming loan limit for most counties in the US is $548,250. A jumbo refinance loan may be right for you if you have a large mortgage balance and want to lower your interest rate or change your loan term.
To apply for a mortgage refinance loan with USAA, you will need to meet certain eligibility requirements and provide some documents, such as:
- Your personal and financial information
- Your current mortgage information
- Your income verification
- Your asset verification
- Your credit report
- Your property appraisal
You can apply online or by phone and get preapproved in minutes. You can also use USAA’s online tools and calculators to estimate your monthly payment, interest rate, closing costs, and savings.
What Other Options do I Have?
If you are not interested in getting a mortgage refinance loan from USAA or if you do not qualify for one, you may consider getting a home equity loan or a HELOC from another lender.
There are many lenders that offer these products in the US, such as banks, credit unions, online platforms, fintech companies, or peer-to-peer lenders.
However, before applying for a home equity loan or a HELOC from another lender, you should compare different offers and factors, such as:
- The interest rate
- The fees
- The repayment term
- The monthly payment
- The borrowing limit
- The draw period (for HELOCs)
- The eligibility requirements
- The application process
- The customer service
You should also read the fine print carefully and make sure you understand all the terms and conditions before signing any agreement.
A home equity loan or a HELOC can be a useful way to borrow money using the equity in your home as collateral.
However, it can also be a risky move that can affect your financial situation and homeownership.
Therefore, you should weigh the pros and cons carefully and only borrow what you need and what you can afford to repay.
Conclusion
USAA does not offer home equity loans or HELOCs, but it does offer other types of loans that can help you achieve your financial goals. If you are looking for a way to borrow money from USAA using your home as collateral, you may consider getting a mortgage refinance loan.
If you are looking for a way to borrow money from another lender using your home as collateral, you may consider getting a home equity loan or a HELOC.
However, before applying for any type of loan, you should compare different offers and factors,
read the fine print carefully, and make sure you understand all the terms and conditions before signing any agreement.
Oluwatobi
