Question

Veronica owns a home, and when her children went to college, she was looking for a way to help finance their education. She went to the bank and borrowed against the appraised value of her home. This is called a home equity loan.a.trueb.false

Answer 1

True

Step-by-step explanation:

Home equity loan is the difference between the fair market value of your home and the amount that you owe on the mortgage.

Answer 2

True

Step-by-step explanation:

Home equity loan is a kind of loan in which a person borrows against the equity of his or her home, i.e the home is used as a collateral. The loan that can be gotten by the individual is dependent on the value of the home or residence and this value can only be determined by an appraiser from the institution providing the loan. In instances when the borrower is unable to repay the loan, the lending institution can foreclose on the home which has been used a collateral.

Home equity loan can be used to finance expenses like education bills, medical bills and so on.

Therefore, Veronica took a home equity loan to help finance her children's education.