There are two main types of equity loans you can get on your house. A home equity loan is a lump sum payment equal to a percentage of money you have paid into your home. A home equity line of credit is different and works more like a credit card, where you borrow only money you need from your home equity.

Equity loans have to be paid back, usually on a monthly basis. This includes principal payment plus interest for month. If you do not pay on time, you can end up ruining your credit and be forced to pay a higher loan rate on any credit you apply for. On other hand, timely payments can help you raise your credit score so you are able to refinance your equity loans and secure even lower interest rates.

To get a secured loan it can take time for loan approval, as property will be inspected and appraised. Unsecured loans such as credit cards are usually faster to acquire, however loan approval time may include a credit check. A credit check involves a lender getting a copy of your credit report to inspect your credit history.

The loan approval process will differ for each type of loan. A quick loan will often have a higher interest rate, therefore it is often essential to compare loan rates and then decide which loan option is best for your situation.