Home Equity Line of Credit (HELOC)

HELOC stands for home equity line of credit, which is a type of loan that allows a homeowner to borrow against the equity in their property.

More Details

A home equity line of credit (HELOC) is a type of loan that allows you to borrow money using the equity in your home as collateral. With a HELOC, you can typically borrow up to a certain amount, called the credit limit, over a set period of time, called the draw period. During the draw period, you can withdraw money as needed, up to your credit limit, and make payments on the amount you borrow.

Example

If you want to make some home improvements, one way to finance them would be to take out a home equity line of credit, which will provide the cash needed to pay for those improvements immediately. You will then make payments on the amount you borrowed.