Home Equity Line of Credit (HELOC)
One of the cornerstones of the American dream is the ability to save up and own a home of your own. But, what you may not realize is you can put that home to work for you by using a home equity line of credit, or HELOC. Now you can apply for a HELOC online in minutes.
With a home equity line of credit, you can add financial flexibility to your life, using your home equity to secure a revolving line of credit. Borrow exactly the amount you need (up to the available limit), exactly when you need it. As you repay the loan, you replenish your available credit.
A home equity line of credit from Associated offers:
- A flexible line of credit that can be used over and over again
- Payments as low as "interest only"
- Pay interest only on what you borrow
- The ability to lock in your interest rate
- No closing costs
- Competitive low interest rates
- Interest may be tax deductible (consult your tax advisor)
- Quick, convenient access using checks or online transfers
What is a Home Equity Line of Credit?
As you pay off your home loan, you build equity (equity is the difference between your home value and loan amount). With a home equity line of credit, you can access that equity and use it to make purchases.
Home equity lines of credit are often used for purposes such as:
- Home improvements
- Medical bills
- Funding a wedding
- Consolidating bills
- Purchasing a car, boat, ATV, etc.
What’s even better is that home equity lines of credit offer additional benefits over traditional loans or credit cards including competitive rates, low closing costs, and possible tax deductibility.
How does a Home Equity Line of Credit differ from a Home Equity Loan?
The simplest way to understand the difference between the two is this: A line of credit remains available to you, even after your balance is paid off, much like a credit card. A loan, on the other hand, is a one-time transaction that's paid off over time with regularly scheduled payments of principal and interest.
How much home equity do I have?
Finding out how much equity you have in your home is easy. It’s just a matter of completing this simple calculation:
Step 1: Estimate the value of your home. You can get approximate information by looking into your property tax assessment or the recent sale prices of similar homes in your area. Keep in mind these are just estimates and lenders will usually have an appraisal performed in order to determine your home's value.
Step 2: Calculate the total of any mortgage(s) and any liens on the property.
Step 3: Subtract the total amount of any mortgages and any liens from your estimated home value.
For example, if your home is worth $150,000 and you have a $100,000 mortgage remaining, you have $50,000 in home equity. Typically you may be able to borrow a portion of this equity.
There are many factors that determine whether you’ll qualify and how much you’ll qualify for, so apply online, contact us today or visit an Associated Bank branch location near you to find out more about a home equity line of credit.
* Property insurance and flood insurance, if applicable, will be required on collateral.