A Home Equity Line of Credit (HELOC) is a revolving line secured by your home. You can draw funds during the draw period (up to 30 years) and then repay the outstanding balance over a repayment period (typically 10–20 years). You only pay interest on what you actually draw.
Frequently Asked Questions (FAQ)
What is a HELOC and how does it work?
How is a HELOC different from a Home Equity Loan?
A HELOC is revolving with a variable APR; you can borrow, repay, and re-borrow during the draw period. A Home Equity Loan is a fixed, lump-sum installment loan with a fixed rate and fixed monthly payment.
How much can I borrow?
Your limit is based on your home’s value, your current mortgage balance, credit profile, income, and program rules. We typically allow up to 90% combined loan-to-value (CLTV), subject to underwriting and state limits.
What rate will I get? Are HELOC rates fixed or variable?
HELOC APRs are variable and usually tied to an index (e.g., Prime) plus a margin. Our representative range starts at 5.00% and up, and your final APR depends on credit, CLTV, state, property type, and discounts (e.g., autopay).
How do monthly payments work?
During the draw period, payments are often interest-only on your outstanding balance. In repayment, the balance is fully amortized over your remaining term (e.g., 10–20 years), so the monthly payment generally increases versus the draw period.
What fees should I expect?
Fees vary by program and state. They may include an annual fee, origination/underwriting, appraisal, title/recording, and an early-closure fee if the line is closed soon after opening. You’ll receive a detailed, state-specific fee schedule with your disclosures.
What are the basic eligibility requirements?
Typical guidelines include minimum 620 FICO, maximum CLTV up to 90%, verifiable income, acceptable debt-to-income ratio, and eligible property type (primary residence, second home, or investment property, program-dependent).
Where is this HELOC available?
We currently serve all U.S. states except New York and Hawaii. Availability, terms, and limits may change and can vary by state.
How does a HELOC affect my credit, and what if I miss payments?
Applying may involve a hard credit inquiry, which can affect your score. Your HELOC usage and payment history are typically reported to credit bureaus. Because a HELOC is secured by your home, late or missed payments can lead to fees, negative credit reporting, and in severe cases foreclosure. Borrow responsibly.
Can I pay off my HELOC early? Are there prepayment penalties?
Prepayment penalties are usually none on our programs; you can make extra payments or pay off the balance early. Some fees (e.g., early-closure or reconveyance) may apply per program/state—see your disclosures.