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Home Equity/Mortgage Loans

Your home equity is the difference between what you owe on your mortgage (and on any other home loans) and the market value of your home. You build equity as that difference grows - when you repay mortgage principal to decrease the amount you owe, or when your home's value increases.

You can borrow against that equity when you need cash, using either a home equity loan or a line of credit. Both offer a number of advantages over other types of financing, including:

  • Interest Savings. Home equity loans and lines typically have much lower interest rates than other types of financing, such as credit cards and personal loans.
  • Tax Benefits. As of tax year 2018 restrictions now apply. Proceeds used to perform home improvements are typically tax deductible. Consult your tax advisor about the deductibility of interest.
Comparing Home Equity Loans and Credit Lines
  Home Equity Loan Home Equity Line of Credit
What You Get A single lump-sum payment
for the full loan amount.
A revolving source of cash that you can
draw from as needed.
How You Use It To finance large one-time expenses
that have a definite cost.
To finance ongoing expenses or misc.
purchases, like a credit card.
How You Repay Repay the full loan amount over
a specific time period, at a fixed
interest rate.
Make payments on the outstanding
balance, at a variable interest rate.
Benefits It offers simple repayment terms,
and the security of knowing your
payments will never increase.
It's there when you need it, and you
only make payments on what you use.

The home must be your primary residence in MD, PA, DC, VA, DE or NJ and be zoned for residential use. Mobile homes are not eligible.

Have a High Rate Home Equity Loan Elsewhere?


A variable-rate credit line secured by your principal residence in Maryland, Virginia, Pennsylvania, Delaware, New Jersey or the District of Columbia, your Home Equity Line Of Credit has an interest rate that is based on the Prime Rate as published in the Wall Street Journal. A discounted 2.49% APR* introductory rate is available for the first 9 months of the loan. Ongoing rates are as low as prime - 1/2%, subject to a floor rate of 3.0% APR. The loan rate is thereafter reviewed and adjusted quarterly.

The maximum line may be up to 85% of the value of your home less your existing mortgage that will not be paid off with the loan proceeds. Third mortgages are not permitted unless the second mortgage is held by LM Federal. Once your loan is settled at the Credit Union, or at one of several locations convenient to you, funds may be accessed conveniently with check-writing at no cost.

There are no application or credit report fees. Closing costs are waived for loans with a credit limit of $25,000 or greater. Note: closing costs paid by the Credit Union will be added to the loan payoff if the loan is closed within three years of origination (paying the loan to zero does not mean the loan is closed).

LMFCU Home Equity Line of Credit Disclosure (PDF)

What You Should Know About Home Equity Lines of Credit

The minimum monthly payment due is based on the balance when a loan advance was last given. The minimum payment is calculated by amortizing your new loan balance of a 20-year term at the current interest rate in effect. You may repay your loan by convenient payroll deduction, by automatic transfer from a Credit Union account or the mail. To calculate a payment, consult our online loan payment calculator.

Send an email to a Loan Specialist at loans@lmfcu.org

* APR = Annual Percentage Rate

Have a High Rate Home Equity Loan Elsewhere?


This borrowing option is a fixed-rate installment loan secured by your primary residence in Maryland, Virginia, Delaware, Pennsylvania, New Jersey or the District of Columbia. Members with good credit will qualify for our lowest rates and be able to borrow up to 85% of the value of their home. Repayment terms of up to 15 years are available. There are no points, balloon payments, credit report, lender or application fees.

Closing costs are typically paid by the Credit Union if the loan amount is $20,000 or greater. For loans of less than $20,000, closing costs for the loan may be paid at settlement by the member or taken from the loan proceeds. NOTE: Most closing costs paid by the Credit Union will be added to the loan payoff if the loan is paid off within three years of origination.

For repayment terms of up to 10-years the maximum loan is $150,000. For repayment terms of up to 15-years the maximum loan is $100,000.

Closing costs include fees for a title search, attorney fees, county and/or state taxes and fees, recording and release fees, lien and/or judgment reports, etc. Ask for a closing cost estimate prior to submitting an application. Closing costs, which range from $400 to $2,250, will vary based on fees and taxes charged by your local and/or state government.

Send an email to a Loan Specialist at loans@lmfcu.org

Our first mortgage program has been suspended as we have issued the amount of loans for the funds that we had available.

Please check back on the page for any future updates.

Sorry, loans are limited to $200,000. Home purchase loans are not available.

  • Rates as low as 2.75% for a 15-year term (2.810% APR*)
  • 15-year payment per $1,000 of $6.79
  • No points, no application or credit report fees
  • Maximum loan-to-value of 80%**
  • Maximum repayment term of 15-years
  • Available on your primary residence only

There are many reasons to refinance. Let us help you explore your possibilities to determine if refinancing is beneficial to you.

  • Build equity faster and pay off your mortgage sooner. Consider refinancing your 30-year mortgage to a shorter-term loan. More of your monthly payment goes to principal. Shorter repayment terms also reduce the interest paid over the life of the loan.
  • Get cash for your current equity. Consider refinancing for a loan larger than your current mortgage and use the cash-out for goals such as decreasing other high-rate debt, paying educational expenses or making home improvements.
  • Trade your ARM for a fixed-rate loan. If you’re nearing the end of your ARM introductory rate period and plan to stay in your home, consider refinancing to a fixed-rate, fixed-term mortgage option.

When your primary purpose for refinancing is to lower your interest rate and monthly payment, without taking additional cash out or reducing the term, a simple calculation can help you determine whether a refinance might work for you.

Simply divide the anticipated monthly payment savings by the amount of closing costs required for the new loan. This calculation will give you a close idea of the time needed to “break even.” Here’s an example:

Monthly Payment Savings:  $100
Closing Costs for Refinance:  $2,200
2,200 ÷ 100 = 22

You’ll need 22 months to break even on the closing cost paid with savings from the new, lower monthly mortgage payment. In this example, you will actually begin to save money in month 23—and your savings will continue every month after that, for the life of your loan.

As you can see, how long you expect to stay in your home is a very important factor to consider. If you believe you’ll likely move prior to your break-even point, it may not make sense for you to refinance.

To learn more about refinancing with LMFCU, call 800-410-0501 or email loans@lmfcu.org

* APR = Annual Percentage Rate ** Rates are subject to change without prior notice. Maximum loan amount, rate and loan to value are based on your credit score.
Lower LTV’s and loan amounts apply for credit scores below 730. Loans for a home purchase are not available. Available on your primary residence in MD, PA, DC, NJ and VA. Mobile home financing is not available. Payment quoted does not include escrow. LMFCU is an equal housing lender.