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HELOC
(Home Equity Line of Credit)
A HELOC (Home Equity Line of Credit) is a revolving credit line secured by home equity, functioning like a credit card with variable interest rates tied to benchmarks like the SOFR. Borrowers access funds during a “draw period” (5–10 years), then repay over 10–20 years.
HELOCs are popular for renovations (which may increase LTV) or debt consolidation. Rates are typically lower than credit cards due to collateral, but missed payments risk foreclosure. Lenders often require a FICO score of 680+ and ≤85% LTV. The CFPB advises comparing HELOCs against alternatives like cash-out refinancing.
HELOCs are popular for renovations (which may increase LTV) or debt consolidation. Rates are typically lower than credit cards due to collateral, but missed payments risk foreclosure. Lenders often require a FICO score of 680+ and ≤85% LTV. The CFPB advises comparing HELOCs against alternatives like cash-out refinancing.