Disbursement Options
You can receive cash from your lender in the form of a line-of-credit, a lump sum, as monthly installments, or a combination of these choices. Even if you do not need additional funds at this time, setting up the growing line-of-credit is a powerful retirement tool that can provide you with life-long financial security.
Lump Sum
Whether you choose a Line-of-Credit or a fixed rate loan, you can receive a lump sum at close. On fixed rate loans, a lump-sum is your only option to receive additional funds above any mandatory payoffs you may have. Every month, interest is charged on the balance of the loan; therefore, if you pay down your principal balance, the monthly interest amount will decrease.
Line-of-Credit
You can pay down your LOC as you see fit and draw money back out up to your approved limit, which grows every year. Every month, interest is charged on the balance of the LOC. The LOC can only be in first position and will not subordinate.
Monthly Installments
With a Line-of-Credit, you can receive monthly installment payments directly to you. The amount of money you can receive every month will depend on several factors: your LOC limit, the amount drawn at closing, whether you choose a term or tenure payment and your prevailing interest rate.