A Home Equity Line of Credit, known as a HELOC, can be your most powerful financial tool. Your HELOC works a lot like a credit card, but you'll get an interest rate much lower than most credit cards because the equity in your home secures the loan. Use as little or as much of your credit limit as you like, pay it back and use it again during your ten-year draw period. After your ten-year draw period, you'll have ten years to pay off your balance.
A HELOC is perfect for home renovations, which are usually tackled one at a time. It's also perfect for debt consolidation, a dream vacation, or any other large purchase.
HELOC vs. Home Equity Loan
HELOCs differ from Home Equity loans because you can use as little or as much of your credit line as you desire, and you can draw funds again and again during your draw period. Monthly payments for HELOCs will vary. With a Home Equity loan, you take your funds in one lump sum, and your interest rate is fixed, making your monthly payment consistent.
Determining whether to use a HELOC or a home equity loan is not always a simple task. Talk to one of our experts or take our quiz to help determine which loan fits your needs.
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