While home equity loan products can offer money-saving opportunities for homeowners, attractive interest rates can be offset by the added expense of fees and/or closing costs. When comparing lenders’ rates, be sure to find out if there is a discount by having the bank pay closing costs.

The mortgage rates and fees on a loan can vary based on the amount you are borrowing plus how much equity you have available. Lenders may provide existing customers with special introductory or teaser rates which adjust upward after an initial period of time. Some fees to be aware of are:

• Annual Account Maintenance
• Application
• Closing costs (normally include credit report, appraisal, title search, flood evaluation, filing fees, and miscellaneous taxes.
• Loan origination (points)
• Pre-payment penalty

Some competitive loan offers include no fees, no points, and no closing costs. Make sure all fees are disclosed upfront, and inquire how they will affect your final interest rate. Also, some banks offer a relationship banking product, in which you get special benefits by having multiple accounts at one bank. You should look into whether your bank offers this product, so that you can use your home equity loan to help you waive fees and receive additional benefits on your checking and savings accounts.