HELOC for Home Improvement

Melissa McCollough

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Published on 02-13-2020

Categories: Member Tips

HELOC infographic

If you’re a homeowner who has paid down a large chunk of your mortgage, you could be sitting on a big mountain of equity. If your house is worth more than what you owe for it, you could be able to use that equity to make home improvements. The housing market in the Triangle is booming, so why not utilize that extra money instead of moving? Here’s when a home equity line of credit, also known as a HELOC, comes in handy.

A HELOC is a line of credit secured by your home that gives you a revolving credit line to use for large expenses or to consolidate higher-interest rate debt on other loans such as credit cards. It often has a lower interest rate than other common types of loans, and the interest may be tax deductible. Please consult your tax advisor regarding interest deductibility as tax rules may have changed.

Investing in your home and making improvements is a smart idea whether you’re looking to sell or just create a comfortable environment for yourself and your family. To qualify for a HELOC, you need to have available equity in your home, meaning that the amount you owe on your home must be less than the value of your home. Coastal allows you to borrow as much as 100% of your home’s equity and offers an interest only option with interest only payments.

Consider that a lender generally looks at your credit score and history, employment history, monthly income and monthly debts, just as when you first got your mortgage. Ultimately, take the time to consider all your options and pick the best one for your specific financial situation.

 


Disclosure: All loans are subject to approval


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