Benefits of a HELOC

By: John Hirabayashi

Posted on 11/5/2014 12:00:00 PM

A home equity line of credit (HELOC) is a great way to obtain cash for your needs, whether you are looking to do some work on your home, or you want to consolidate some other debt, such as credit cards, medical expenses or other major expenses. This type of lending has declined in recent years, but lenders are once again seeing an increase in HELOC applications from lenders. If you own your home and are looking to restructure your finances, a HELOC can be a great option. Here is what you need to know if you are considering a HELOC.

A home equity line of credit (HELOC) is a great way to obtain cash for your needs, whether you are looking to do some work on your home, or you want to consolidate some other debt, such as credit cards, medical expenses or other major expenses. This type of lending has declined in recent years, but lenders are once again seeing an increase in HELOC applications from lenders. If you own your home and are looking to restructure your finances, a HELOC can be a great option.

What is a HELOC?

A home equity line of credit (HELOC) is similar to a second mortgage. However, you don't have to have an existing first mortgage in order to obtain a HELOC; your HELOC can be a first or a second mortgage. A HELOC is a great way to save money and have access to the funds you need, without relying on expensive credit cards. To obtain a HELOC, you simply fill out an application with the lender of your choice, use the equity in your home for collateral, and the lender approves your loan in a specific amount. However, unlike a traditional mortgage, the lender usually doesn't advance the entire amount of the loan at the time of lending. It's like a credit card, in the sense that you can take advances on the loan whenever you need funds. Generally, this is done in the form of checks that you write to yourself and deposit in your bank account. When you do this, the amount of the check is added to the amount of your loan.

A HELOC is a great way to get the cash you need at a cost that you can afford. If you own your home and are in need of funds for home repairs, updates to your home, medical bills, college expenses, or other major bills, give Community First Credit Union a call today and let us help you reach your goals. You can also stop by your nearest Community First branch and speak to a mortgage specialist in person to hear about all of your borrowing options. We are proud to serve the community and help our customers reach their dreams.


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