What is a Home Equity Line of Credit?
A home equity line of credit, or HELOC, let’s homeowners borrow money against the equity they have built up in their homes. Like other kinds of home equity funding, a HELOC is based on the value of your home compared to how much you still owe on your mortgage.
A HELOC is different than a home equity loan because it is a line of credit. A line of credit, a HELOC doesn’t have a set borrowed amount. Instead, it has a limit that you can borrow up to, similar to a credit card.
Some reasons people take out HELOCs include:
- Renovations or remodeling on a home
- An unexpected expense
- Repair jobs
How Does a Home Equity Line of Credit Work?
A HELOC works very similarly to a credit card in that you can borrow up to a set limit and you repay what you owe plus interest. Unlike a credit card, a HELOC is a secured line of credit, backed by your home. This means rates on HELOCs are typically lower than unsecured loans, like credit cards.
Who Qualifies for a Home Equity Line of Credit?
Homeowners who have built up some amount of equity in their homes may be eligible for a HELOC. Equity is the value of your property minus the outstanding mortgage amount. If your home is valued at $300,000 and you have a $200,000 mortgage, you have $100,000 of equity.
Why Choose Arizona Central Credit Union for a HELOC?
Why Choose Arizona Central Credit Union for a HELOC?
Arizona Central Credit Union has been providing Arizona families in Phoenix and beyond with home equity funding and other financial services since 1939. Whether you already have an account or are just looking for lending options, Arizona Central, Arizona’s leading local credit union, will be here to safeguard you and help you achieve your goal of financial freedom.
Arizona Central Credit Union has 9 branches throughout Arizona, including Phoenix, Glendale, Tempe, Chandler, Flagstaff, Tucson and Show Low. Members have access to 30,000+ surcharge-free ATMs nationwide through the CO-OP ATM network. Arizona Central makes banking accessible & rewarding for all AZ communities.
