A Home Equity Line of Credit can be a great way to get extra cash when you need it. Whether the funds are for your child’s college tuition, paying off credit cards or medical bills, remodeling your home or taking that dream vacation—a HELOC is perfect!
What is a HELOC?
- While it’s commonly referred to as a second loan, a home equity line of credit (HELOC) is a type of adjustable-rate mortgage that gives homeowners access to an amount determined by the lender from their value or equity in their homes.
- For a better understanding of how an HELOC works, think about it like a credit card. You have the option to access this line with separate transactions up until certain limits depending on what’s agreed upon in terms, and you are required to pay back what you owe with interest.
- You can use your HELOC for anything you want, but the funds are backed by the value of your home, so it’s best to spend wisely.