Mortgage Hack #5
A home equity line of credit, HELOC for short, is a credit line that provides the borrower with a revolving credit line and is secured by the home. When compared to certain other popular loan kinds, a HELOC frequently has a cheaper interest rate, and the interest may be tax deductible. You can draw from the HELOC, pay it off, and draw again, much like you can with a credit card. A homeowner could gain from using a HELOC in a number of ways:
1. Use the home's equity without refinancing.
2. Keep the current house and use the equity as a down payment for a new one.
3. Usage for major purchases or to pay off debt from other loans or credit cards with higher interest rates.
4. Their credit score could rise as a result of the new line of credit.
Reference: 2022 Keller Mortgage LLC