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How to Take Advantage of Your Home Equity Line of Credit 6/10/2020

HELOC

Summer is the perfect time to tackle home maintenance and renovation projects. Whether you’re looking to remodel the kitchen or install a new master bathroom suite, working on your home over the summer means you won’t have to contend with winter’s inclement weather and short dark days – but of course, there’s still the challenge of how to pay for your renovations.

A Home Equity Line of Credit is a natural way to use the value in your home to finance short-term expenses like home improvements, summer vacations—or both. Stay cool this summer by putting your home’s equity to work for you with these summer project ideas.

What is a Home Equity Line of Credit?

A home equity line of credit, or HELOC, is a second mortgage that gives you access to cash based on the value of your home. You can draw from a home equity line of credit and repay all or some of it monthly, somewhat like a credit card.

With a HELOC, you borrow against your equity, which is the home’s value minus the amount you owe on the primary mortgage. You can also get a HELOC if you own your home outright, in which case the HELOC is the primary mortgage rather than a second one.

Whether a HELOC is a secondary or primary mortgage, you could lose the home to foreclosure if you don’t make the payments.

Summertime HELOC Projects

  1. Keep your cool all summer long. Maybe it’s about time to retire your aging air conditioner—but a new A/C unit is a pretty big investment. A Home Equity Line of Credit can help lighten the load so you can replace your old unit before it decides to gasp its last breath on the hottest day of August.
  2. Take advantage of good construction weather. Do you have backyard improvements on your mind? Summertime’s the perfect time for outdoor construction projects, including new fences, new decks, a chic pergola, outdoor swimming pool, or even a custom outdoor kitchen.
  3. Get away from it all. Maybe what you really need is less time worrying about home matters and more time taking the stress off your shoulders. That summer dream vacation you’ve never quite managed to work into the budget the past couple of years becomes doable with a home equity loan.
  4. Think ahead to fall fun. If summer’s not really your season, carry the fun into the fall with improvements like a backyard fire pit. This home improvement can be a simple DIY project or an elaborate presentation. Either way, gathering around the fire on a crisp autumn evening can be an invigorating way to reconnect with friends and family at the end of a long day.

The Right Home Equity for Your Project

Remember, any time you use your home as collateral for a loan, you risk losing your home should you default on the loan. HELOC loans are not meant to help you live beyond your means. But rather reinvest in your home’s own value with a renovation project or taking a well-deserved vacation you’ve been putting off far too long, might be just the thing to cool off a sweltering summer.



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