Cool What Happens If You Stop Paying A Home Equity Loan References. The main reason why homeowners take out home equity loans to pay down their mortgage is that they think doing so will result in lower monthly payments. Combined with your mortgage, this form of insurance pays for the debts you owe if you pass away.

The loan is secured against your home equity. Although your biggest concern is likely if you miss payments on a home equity loan, you can lose your house, it’s usually not that straightforward. After paying off your home equity loan in full, you are no longer responsible for making monthly payments toward the loan, including any interest payments.