California Home Equity Loans

California Home Equity Loans Are Still a Viable Source of Credit

Although real estate values have declined in California, home equity loans remain a viable source of credit for a great many homeowners. This is especially true for people who have owned their homes for five years or more.

Add the fact that California home equity loan rates have come down, as they have across the country, and this is still a good time to consider a home equity loan.

Timing Key to California Home Equity

As always, location is a key to how well real estate values have held up in California, but home equity is also very much a function of timing.

Despite a pronounced decline, home values in the Los Angeles area are about where they were July of 2005; in the San Francisco area, they are at around April of 2005 levels; in San Diego, home values are close to May of 2004 levels.

What this means is that even in San Diego, which suffered the brunt of the housing slump, most people who have owned their homes for four or more years should find their home values at or above the prices they paid. In addition, home equity builds naturally over time, as mortgage principal payments start to add up.

Considerations with a California Home Equity Mortgage

Given the volatility of home prices, it might not be bad to leave a cushion of home equity. Also, consider whether your needs are better suited by a home equity loan--i.e., borrowing in a single lump sum--or a home equity line of credit, which you can access in part or as a whole at multiple times. The important thing is, for many home owners in California, home equity borrowing options remain available.