Home Equity Debt

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Home Equity Debt

Debt collateralized by the value of one's home. The amount of this debt is generally the difference between the homeowner's equity in his/her house and the market value of the house. If home equity debt is not paid off, the lender may take possession of and sell the house in order to pay for the loan. This can occur even if the homeowner continues to make payments on his/her mortgage. This debt generally has a variable interest rate, which is nonetheless still lower than most other lines of credit.
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