July 22, 2020

This paid piece is sponsored by Central Bank.

Are you among the many homeowners thinking about making upgrades around the house? You’re far from alone – and this bank is ready to help you finance those improvements.

“Amid the coronavirus pandemic, we have seen an increase in demand,” said Keith Portner, senior vice president and business development sales manager of Central Bank, which has several Sioux Falls locations. “Locally, borrowers are requesting home equity lines of credit specifically for home improvements and debt consolidation.”

A home equity line of credit is a flexible, revolving line of credit secured by your home or second home. You can advance the money, pay it back and then use it again during the draw period of the loan.

Your spending limit is a percentage of the equity in your property, and you are able to borrow against the equity to finance a remodel, pay off debt, purchase a car or make a big purchase.

If you don’t have a mortgage on your home, you can use it the same way as an inexpensive way to obtain financing.

“If you have lived in your home for a good amount of time and make regular payments on your mortgage, you’ve done yourself a huge favor,” said Kathy Thorson, senior vice president and market president of Central Bank.

“With every mortgage payment, you own a little bit more of your home and increase your home’s equity, which can be used to your advantage.”

The same applies if you put a large amount down when you purchased the home.

“Using a home equity line of credit can be both a smart financial decision and an opportunity to make the most of your home’s value,” Thorson said.

Here are some common questions Central Bank’s lending team receives about home equity lines of credit.

How much is the payment? 

The required payment amount is interest only, and you are able to make principal payments anytime. Central Bank’s home equity lines of credit have a 10-year maturity.

We know this is a favorable time for mortgage loans given the rate environment. Is the same true of home equity lines of credit?

It is a favorable rate environment. Our home equity lines of credit are tied to the prime rate, which is presently low.

At Central Bank, borrowers also receive a rate discount if auto payments are made from a Central Bank checking account.

How long does the application process normally take? Could I still start my project in the coming months or even weeks?

There is a two- to three-week turnaround time.

What should I do to get started?

Have a discussion with your banker, or apply online at centralbankonline.com. Central Bank will require some documents – two years of tax returns and W-2s, two of your most recent pay stubs, a mortgage statement and your current insurance policy. If you’re retired, your most recent benefit statement will be required. Reach out anytime with questions!

Central Bank NMLS ID #447201

Keith Portner NMLS ID #464388