We get lots of questions about Home Loans and our resident expert, Mary Beth Geglia will be sharing the answers to some of the most common ones with us on the blog.
What is a Home Equity Line of Credit (HELOC) and what are good uses for it?
A Home Equity Line of Credit is a line of credit against your home. It differs from a Fixed Home Equity loan in that every time you make a payment on the HELOC, the money can be reused. Some examples of when this might be the right kind of loan for your are:
- A child going away to college when you’ll need to send a different payment amount multiple times per year.
- When you have multiple purposes for the money and you don’t need all the money at once. For example, putting in a pool one year, a deck the following year, and a vacation the third year.
You can make the payments on one project at reuse the money again when other projects come up. You’re also only making payments on the money you’ve drawn against it, not the entire amount.