For many homeowners, it's the most flexible way to pay for a remodel, consolidate higher-interest debt, cover tuition, or keep a cushion on hand for life's surprises.
Why homeowners choose a HELOC
- Keep your first mortgage. If you like the rate and payment on your current mortgage, a HELOC sits behind it as a second loan. Nothing about your first mortgage changes.
- Use it, pay it down, use it again. During the draw period, money you repay becomes available to borrow again.
- Pay for what you use. No need to borrow a big lump sum up front if your project happens in stages.
- One approval, many uses. Home projects, paying off credit cards, a child's education, or an emergency fund.
How a HELOC works
- We figure out your available equity. We start with your home's value and subtract what you owe on your first mortgage. Many programs allow up to 90% combined loan-to-value (CLTV), meaning your first mortgage plus the new line can total up to 90% of your home's value, depending on credit, property, and program. (In Texas, state law sets the limit at 80%.)
- The draw period. For a set number of years, you can borrow from the line as needed.
- The repayment period. After the draw period ends, you pay back the balance over a set term.
HELOC rates are usually adjustable, which means your payment can change over time. We'll explain exactly how your line works before you commit.
Is a HELOC the right fit?
A HELOC tends to work well when:
- You want to keep a low rate on your first mortgage.
- Your costs will come in stages, like a remodel paid to a contractor over several months.
- You want access to funds without borrowing all of it today.
If you need one set amount right away and prefer a fixed payment, a home equity loan may suit you better. If your first mortgage rate is higher than today's options, a cash-out refinance could combine everything into one loan. Not sure? Compare them side by side on HELOC vs. Home Equity Loan, or just ask us. We'll lay out the options in plain terms.
Self-employed? You can still get a HELOC
Many of our HELOC clients own their own businesses. If your tax returns don't show everything your business earns, we have options that look at bank statements instead. Learn more on Self-Employed Loans.
Estimate what you could access
Try our HELOC calculator to see your estimated available equity. It's a quick way to get a ballpark number before we talk.
Where this is available
HELOCs on your primary residence are available in California, Arizona, Colorado, Florida, and Texas. In Texas, state law sets special rules for home equity on the home you live in. See Texas.
Program availability can vary by state and property. Contact us to confirm options for your home.