Loans
Home Equity Loans & HELOCs
A home equity loan lets you borrow against the equity in your home. Equity is the part of your home’s value that you truly own: the home’s value minus what you still owe on your mortgage. You can borrow a lump sum all at once, or open a line of credit you draw from as needed. Deb Gontko Klein helps owners weigh both choices with the full cost in view. Serving home buyers in Arizona, California & Colorado since 2004.
Who it helps
- Owners who need funds for a large, one-time cost, such as a major repair.
- Owners who want funds they can draw on over time, for costs that come in stages.
- Owners with equity built up and a clear plan to pay the money back, if you qualify.
How it works
Home equity loan: You borrow one lump sum and pay it back in regular monthly payments, on top of your mortgage payment.
HELOC: A HELOC, short for home equity line of credit, is a credit line tied to your home. You draw what you need and pay interest on that balance. During what is called the draw period, you can make additional draws from the remaining funds.
How much: How much you can borrow depends on your equity, income, debts, credit, and how the property is used. Your home is the collateral, which means the lender can take it if the loan is not paid back.
Things to think about
- Rate risk: Home equity loans have fixed rates. A HELOC may have a variable or fixed rate. If the rate is variable, it can go up or down, and a higher rate means a higher payment. Ask how the rate can change.
- Borrowing against your home lowers your equity and adds a payment. Only borrow what you need, with a plan to pay it back.
Questions people ask
What is home equity?
The part of your home’s value you truly own: the value minus what you still owe on your mortgage.
What is the difference between a home equity loan and a HELOC?
A home equity loan gives you one lump sum. A HELOC gives you a credit line you draw from as needed.
Can my HELOC payment go up?
It can, if your HELOC rate is variable. Ask how the rate is set and how high it can go.
Next step: Call Deb at (480) 550-0211 to talk through whether a lump sum or a line of credit fits, or apply through Planet Home Lending.
Official source: Consumer Financial Protection Bureau: Owning a Home
Get Started
Talk with Deb
Tell us what you want to do, and we will call you back with clear next steps. It takes about a minute. Prefer to talk now? Call (480) 550-0211.
Serving home buyers in Arizona, California & Colorado since 2004