Home Equity Line of Credit
Home Equity Line of Credit
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A Home Equity Line of Credit (HELOC) is a line of credit attached to your equity in your home. It works very similar to a personal line of credit in that you will receive monthly statements with a minimum payment needed allowing easy management of your finances.
Benefits
- HELOC value may be as large as 65% of the market value of your home.
- You can use some or all of your available line of credit at your convenience.
- Flexible repayment options — you can make the required interest only monthly payment or pay a larger amount up to the entire balance.
- There are no prepayment penalties like a mortgage would have as the loan is open
- These can be bundled with a normal mortgage to access up to 80% of your home. Most of the bundled products have a component that as your mortgage is paid down the limit on the home line increase up to that maximum 65% of your home value allowed
- They generally do not have any monthly or annual maintenance fees unless they are a specialized product. Therefore you only pay on them if you borrow money.
