Home Equity Line of Credit
Access Your Home's Value
Tap into your home's equity with flexible borrowing options. A HELOC gives you access to funds when you need them with competitive rates and potential tax advantages.
How HELOC Works
A Home Equity Line of Credit lets you borrow against your home's equity — the difference between your home's value and what you owe on your mortgage.
Your Home's Value
The current market value of your property
Mortgage Balance
What you still owe on your primary mortgage
Tappable Equity
The portion of your equity you can access
$400.000
Calculate Your Tappable Equity
Estimate how much of your home's equity you may be able to access with a HELOC. Adjust the sliders to match your specific situation.
Most lenders limit combined loan-to-value (CLTV) ratio to 80-90% of your home's value
Your Equity Breakdown
How HELOC Works
A Home Equity Line of Credit gives you flexible access to funds when you need them, with a unique two-phase structure that adapts to your changing financial needs.
Application & Home Valuation
Apply for a HELOC and we'll arrange a professional appraisal to determine your home's current market value. This helps establish your available equity.
Loan Approval & Closing
We review your application, credit history, and home value to determine your HELOC amount and terms. After approval, you'll sign closing documents to establish your line of credit.
Draw Period (5-10 Years)
During this initial phase, you can borrow from your credit line as needed, up to your limit. Typically, you'll only pay interest on the amount you've borrowed.
Repayment Period (10-20 Years)
After the draw period ends, you can no longer borrow from the credit line. You'll make regular payments of principal plus interest to pay off the balance.
HELOC vs. Other Financing Options
Compare the benefits and considerations of a HELOC against other common financing methods to determine which option is right for your needs.
| Features | HELOC | Home Equity Loan | Credit Card | Personal Loan |
|---|---|---|---|---|
| Interest Rate | 4.5% - 8.75% Variable | 5.5% - 8.75% Fixed | 16% - 24% Variable | 7% - 36% Fixed |
| Disbursement | Flexible access as needed | Lump sum at closing | Flexible access as needed | Lump sum at approval |
| Loan Limits | Up to 90% of home equity | Up to 85% of home equity | $5,000 - $25,000 typically | $1,000 - $50,000 typically |
| Repayment Terms | Draw: 5-10 years (interest only) Repayment: 10-20 years | 5-30 years | Revolving with minimum payments | 1-7 years typically |
| Tax Deductible Interest | Potentially Yes | Potentially Yes | No | No |
| Collateral Required | Your Home | Your Home | None | None |
| Best For | Ongoing expenses, multiple projects, uncertain costs | Single large expense with known cost | Small, short-term expenses with quick repayment | Medium expenses without using home as collateral |
Smart Ways to Use Your HELOC
A Home Equity Line of Credit provides flexible financing that can be strategically used for various purposes. Here are some of the most financially savvy ways to tap your equity.
Home Improvements
Renovations and upgrades that increase your home's value can be a smart investment. Kitchen remodels, bathroom updates, and energy-efficient improvements often provide good returns.
Debt Consolidation
Replace high-interest debt like credit cards with a lower-rate HELOC. This strategy can reduce your interest costs and simplify your finances with a single payment.
Education Expenses
Fund college tuition or other educational costs with typically lower interest rates than private student loans, potentially with tax-deductible interest.
Investment Property
Use your HELOC for a down payment on an investment property. This can be a path to building a real estate portfolio with relatively low initial capital.
Emergency Fund
Establish a HELOC as a backup emergency fund. You only pay interest if you need to use it, providing peace of mind without the opportunity cost of cash sitting idle.
Major Life Expenses
Finance major life events like weddings or once-in-a-lifetime trips. While not investment uses, a HELOC offers lower rates than credit cards or personal loans.
Caution: Using HELOCs Responsibly
While HELOCs offer great flexibility and potentially low interest rates, remember that your home serves as collateral. We recommend avoiding these uses for your HELOC:
- Financing consumable purchases or everyday expenses
- High-risk investments or volatile assets like cryptocurrency
- Purchasing luxury items that depreciate quickly
- Using a HELOC to cover basic expenses due to inadequate income
Frequently Asked Questions About HELOCs
Get answers to common questions about Home Equity Lines of Credit.
Ready to Tap Into Your Home's Equity?
Take advantage of your home's value with a flexible HELOC. Check your rate without affecting your credit score.
* Rates and terms are subject to credit qualification, property valuation, and other factors.
Consult a tax advisor regarding the deductibility of interest.