What is a HELOC (Home Equity Line of Credit) loan?
A HELOC loan is a revolving line of credit with an adjustable interest rate typically based on the prime rate. You usually access the home equity line of credit by writing checks provided by the lender. Most HELOC loans provide a line of credit up to 85% of your home’s value, minus any current mortgages. You only pay interest on the amount you borrow. If you don’t use the line of credit, you don’t have any monthly payments to make. With a HELOC loan, your home is used collateral; in most cases, the home equity line of credit will be a second mortgage.
Related Questions
- I have a Home Equity Line of Credit (HELOC) or second mortgage. Does the National Homeownership Retention program apply to that loan?
- I have a Home Equity Line of Credit (HELOC) or second mortgage. Does the NHRP apply to that loan?
- Whats the difference between a home equity loan (HEL) and a home equity line of credit (HELOC)?
