Home Equity Line of Credit (HELOC)
What is a HELOC?
A Home Equity Line of Credit (HELOC) is a flexible, revolving line of credit secured by the equity in your home. It allows you to borrow money as needed, up to an approved limit, and pay interest only on the amount you use. Think of it like a credit card—with lower interest rates and the benefit of using your home’s value.
Who Qualifies for a HELOC?
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You may qualify if you meet the following criteria:
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Sufficient equity in your home (typically at least 15–20%)
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Good to excellent credit score
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Reliable income and employment history
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Manageable existing debt
Common Uses for a HELOC
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Home renovations or upgrades
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Debt consolidation
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Education expenses
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Emergency medical costs
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Major life events (wedding, travel)
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Investment opportunities
How Does a HELOC Work?
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Establish Your Credit Limit
Based on your home’s equity, credit score, and income, you’re approved for a maximum amount you can borrow. -
Draw Period (Typically 5–10 years)
Borrow as needed during this period. Withdraw funds via checks, online transfers, or a credit card linked to the HELOC. -
Repayment Period (Usually 10–20 years)
After the draw period ends, you begin repaying the principal and interest on the remaining balance.