HELOC

Equity credit line

A HELOC (home equity line of credit) is a revolving credit account secured by the borrower's home equity—the difference between the home's value and what's owed on the mortgage.

Unlike a lump-sum home equity loan, a HELOC works like a credit card: you draw funds as needed up to a limit, repay, and borrow again.

We're using the HELOC to finance the kitchen renovation.

borrowing

mortgage

Secured home loan

lenderOne who loans money
borrowerOne who takes temporarily
interestAttention, stake, or fee

collateral · debt · repayment · principal · term · refinance · adjustable · fixed-rate · origination · closing

equity

ownership

Legal right of possession

appreciationRecognition of worth
collateralSecurity for debt
loan-to-valueDebt-to-collateral ratio

appraisal · tappable · leverage · homeownership · asset · underwater · cash-out

risk

foreclosure

Lender seizes mortgaged property

lienClaim securing debt
defaultPreset standard option
delinquencyCriminal or neglectful behavior

interest-only · fees · underwater · overleveraged

credit

revolving

Turning around a center

drawCreate with pencil
FICOCreditworthiness rating system
ExperianCredit reporting company

Equifax · TransUnion · utilization · delinquency · default

HELOC

mortgage

ownership

foreclosure

revolving

HELOC

Opposites

Categories

Family