Home equity mortgage loan is a mortgage taken on the security of the home equity. It is a kind of a second mortgage taken against the same property on which there is already a liability due to the dealings involved through a first mortgage. This can be illustrated using a simple example. Suppose a person has obtained a first mortgage of $ 100,000 on his property and has paid $ 50,000 in the last 5 years. Also let us suppose that the value of the house has gone up to $ 200,000 in the same time, then the home equity is $ 200,000 – $ (100,000 – 50,000) = 1, 50,000. Now if the person takes a home loan worth $ 1, 50,000, keeping the home equity as collateral then such a loan is called home equity mortgage loan. The loan is offered as a single lump sum amount and has fixed rates and therefore equal monthly payments over 15 to 20 years. The repayment period is generally shorter than primary mortgage but the interest rates are higher than those for the primary mortgages. The benefits of this loan are that the interest paid is tax deductible and the loan can be used for home renovation, purchasing a second home or even on medical and educational expenses. The downside is that these loans are often used to pay off credit card debts, which may tempt him to further cash from the credit card balances. Also though an application for bankruptcy, under chapter 7, will rid him of credit card debt the same will not apply for home equity loan taken to finance credit card debt.