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Survey Finds Consumers Don't Fully Understand the Advantages of Home Equity and How it Can be Leveraged to Reduce DebtAUSTIN, Texas, April 30, 2024 /PRNewswire/ -- FirstClose™, Inc., a leading fintech provider of data and workflow solutions for mortgage and home equity lenders nationwide, today released the findings of a new national consumer survey that explored homeowners' level of awareness of home equity and how it could be used to pay down higher interest credit card debt. In March, FirstClose commissioned a third-party online survey of 1,000 homeowners who have lived in their homes for at least two years and who have at least two credit cards with outstanding balances. The survey asked consumers a series of questions about their knowledge of home equity loans (HEL) and home equity lines of credit (HELOC) and on their willingness to use these products for different applications, such as consolidating debt, home improvement and to pay for major life events. The findings suggest that there is significant lack of awareness among consumers regarding the financial advantages of leveraging home equity debt versus other kinds of consumer debt. Some of the key findings include: Lack of awareness of interest rates
Misconceptions about home equity products
"The findings of this survey underscore the critical gap in consumers' understanding of the financial benefits of leveraging their equity," said Tedd Smith, CEO of FirstClose. "U.S. homeowners currently have more than $28 trillion in tappable home equity that could be used to pay down credit card debt, which now has topped $1.14 trillion. If a consumer with an average balance of $6,500 made only the minimum payment it would take 13 years and cost roughly $11,800 to pay off the debt completely." Smith continued, "Lenders are uniquely positioned right now, while rates are still on the high end, with no sign of coming down anytime soon, to educate homeowners on the advantages of utilizing home equity responsibly. By empowering homeowners with accurate information and providing comprehensive guidance and resources, lenders can help their customers make informed financial decisions." About FirstClose Headquartered in Austin, Texas, FirstClose, Inc. provides fintech solutions to HELOC and mortgage lenders nationwide. The company's mission is to increase profitability and reduce cost for mortgage lenders. FirstClose makes this possible through offering systems and relationships that enable lenders to assist the lender's borrowers more effectively, reduce closing costs, and ultimately shorten closing times. For more information, visit firstclose.com. View original content:https://www.prnewswire.com/news-releases/survey-finds-consumers-dont-fully-understand-the-advantages-of-home-equity-and-how-it-can-be-leveraged-to-reduce-debt-302131234.html SOURCE FirstClose |