A HELOC (Home Equity Line of Credit) is a flexible loan that allows homeowners to borrower money against the equity built up in their home.
Determining your homes equity is easier than you think.
Example: If your home is valued at $300,000 and you owe $200,000 on the mortgage. You would have $100,000 of equity in the home.
To qualify for a HELOC, you generally need a fair credit score (usually above 640), and a manageable debt-to-income ratio. Other factors, such as your income, assets, and the property's appraisal value, will also be considered.
Both options use your home as collateral, offering lower interest rates compared to credit cards or personal loans. However, there are a few differences to consider.