An Equity Loan is a type of loan that allows homeowners to borrow money against the equity they have built up in their property. Equity is the difference between the current market value of the home and the amount still owed on the mortgage. This loan can be used for various purposes, such as home improvements, debt consolidation, or major purchases. Typically, equity loans come in two forms: a lump-sum payment or a line of credit. The borrowed amount is usually secured by the home, meaning that if the borrower fails to repay, the lender can take possession of the property. This makes equity loans a potentially risky option for homeowners.