5 reasons to love a HELOC

Woman and child look at house construction

If you’re a homeowner facing major home improvement expenses, a home equity line of credit (HELOC) may be just the solution you’re looking for. This line of credit is secured by the equity, or value, you’ve built up in your home. Unlike a closed-end loan, which is one upfront payment to you — like you might get with a personal loan — this home equity loan is open-ended. You can continue to withdraw the money you need as you need it within a specific time period.

Sounds great, doesn’t it? We agree. In fact, here are five more reasons we think you’re going to love a HELOC:

It’s flexible

Sometimes a home’s big expenses are unpredictable. A HELOC gives you the money you need, when you decide you need it. If your new bathroom addition turns into a major plumbing project, your HELOC has your back. Not only that, you can easily request funds from your HELOC with a Real-Time Loan Advance.

Use an LGFCU mortgage or another company’s mortgage

If you have an LGFCU mortgage, you can borrow a maximum of $100,000 or up to 90 percent of the appraised value of your home, minus the amount owed on your mortgage, whichever is less. Even if your first mortgage is not with LGFCU, you may still qualify for an LGFCU HELOC. If approved, you may have the ability to borrow or 90 percent of the appraised value of your home minus the amount owed on your mortgage

Your home equity loan can be used as an overdraft transfer service for your LGFCU Checking Account. That’s just one more way the HELOC is a smart money move!

It can be used with overdraft

Your home equity loan can be used as an overdraft transfer service for your LGFCU Checking Account. That’s just one more way the HELOC is a smart money move!

Interest may be tax deductible

Because the HELOC is a second mortgage, the interest paid on it may be deductible on itemized returns. The interest deduction may only be available as long as the money is used to buy, build or substantially improve your home. Talk to your tax advisor for details.

Low rates

Who doesn’t love low rates? LGFCU offers opportunities to make your HELOC rate even lower by using payroll deduction or funds transfer for repayment.  You can also apply for a Home Equity Line of Credit Modification to lower the interest rate on your current HELOC.

The next time you’re thinking about home repairs, consider whether a HELOC is right for you.

The advice provided is for informational purposes only. 

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