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Home Equity Line of Credit

A home equity line of credit gives you access to a considerable amount of money, typically up to about 85% of your home’s value, less the balance remaining on your mortgage. HELOC is usually considered a “Second mortgage” loan. A home equity line of credit works in a similar manner like a credit card. You get a variable interest credit line of up to a certain limit and can tap it when you want. You pay interest only for up to 10 years, what’s known as the “draw period.” After that, you must pay back interest and principal. The amount of money you can borrow depends on the value of your home, how much you owe on your first mortgage and credit score.

Under federal law, you have three business days to cancel a signed HELOC agreement without any penalty. You can cancel for any reason, as long as your primary residence is used as collateral. The main benefit of HELOC is that it allows you quick and continuous access to money. Funds become available on the fourth business day after you sign all the documents. You can access available funds anytime during the draw period and transfer funds 24/7 using Online Banking programs.

Although equity available in your home is the main requirement for getting the best home rates, other factors will also influence lender's’ decision. These are your credit and your level of debt compared with your income. An excellent credit score will provide you a low APR. An average score will net you a higher rate, and a low credit score could keep you from getting a home equity loan altogether.

Find out more about HELOC and get the best rates by contacting our brokerage experts. We will carefully evaluate your financial profile and possibilities and provide the best HELOC options.

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