Home Equity Lines of Credit (HELOC)

What Is a HELOC?

A Home Equity Line of Credit (HELOC) allows homeowners to borrow against the equity in their home through a revolving credit line. Similar to a credit card, you can draw funds as needed during the draw period, making it ideal for ongoing expenses or projects.


Loan Amount & Equity Requirements


  • Loan Amounts: Based on your home’s value minus the existing mortgage balance.
  • Loan-to-Value (LTV): Borrow up to 85–90% of your home’s value, depending on lender guidelines.


Credit Score & Income Requirements


  • Minimum Credit Score: Generally 620 or higher; better scores may yield more favorable terms.
  • Income Verification: Standard documentation required, though some lenders offer flexible options.


Interest Rates & Repayment Terms


  • Variable Interest Rates: Rates often fluctuate with the prime rate, though some lenders offer fixed-rate conversion options.
  • Draw Period: Typically 5 to 10 years, during which you can withdraw funds and make interest-only payments.
  • Repayment Period: Usually 10 to 20 years after the draw period, requiring full principal and interest payments.


Unique Features of HELOCs


  • Revolving Credit Line: Borrow, repay, and re-borrow funds as needed during the draw period.
  • Interest-Only Payments: Available during the draw period, helping manage short-term cash flow.
  • Flexible Fund Usage: Ideal for home improvements, debt consolidation, education expenses, or emergencies.
  • Lower Initial Costs: Typically lower upfront fees compared to other loan options.


Property Types Allowed


  • Primary Residences, Second Homes, and Investment Properties: Eligible under most HELOC programs.
  • Condos and Multi-Unit Properties: Accepted, subject to lender criteria.


Assumability


  • Non-Assumable: HELOCs cannot be transferred to another borrower.


Ideal Borrowers for HELOCs


  • Homeowners needing flexible access to funds over time.
  • Borrowers planning ongoing or multiple expenses, such as phased home renovations.
  • Individuals looking for a credit line with potentially lower rates than credit cards or personal loans.


Contact Us for HELOC Guidance

Whether you’re planning a remodel, consolidating debt, or preparing for unexpected expenses, our team can help you navigate HELOC options and find the best solution for your financial needs.