Home Equity
Put Your Home Equity to Work for You.
Debt consolidation, private school tuition, home improvement projects. No matter what your financial need is, your home equity may offer an affordable solution. A home equity loan or line of credit (HELOC) offer a practical, affordable option for borrowing against one of your greatest assets — your home’s equity. Put your equity to work and let us take care of the rest.
Home Equity Loans
What is it? A loan where you can borrow a lump sum of money using the equity you’ve built in your home as collateral. It typically comes with a fixed interest rate and predictable monthly payments, which makes it a reliable option for larger, one-time expenses.
Best for: A homeowner who prefers the predictability of a fixed monthly payment.
Home Equity Line of Credit (HELOC)
What is it? Similar to a credit card, a HELOC lets you borrow against your home’s equity as needed and use it for a variety of purchases. It may have a variable or fixed-interest rate and more flexible repayment options. Ask us about our no-cost HELOC, designed to give you flexible access to your home’s equity.
Best for: Homeowners who are unsure how much they may need to borrow, or simply want access to funding whenever a need arises.
Differences in Home Equity Loans and HELOC Explained
| Details | Home Equity Loan | HELOC |
|---|---|---|
| Type of financing | Lump sum loan with a fixed amount of borrowing | Revolving line of credit you draw from, as needed |
| Interest rate | Typically a fixed rate | Often a variable rate, but fixed-rate options may be possible |
| Repayment terms | Typically a set monthly payment over a fixed-term of years | Borrow and repay during the draw period, then repay balance according to terms |
| Access to funds | Receive loan amount in lump sum at closing | Access as needed against the credit line through transfers, a check |
| Best for | Larger, one-time expenses like home renovations or debt consolidation | Ongoing or unpredictable expenses such as home projects or tuition |
Home Equity and HELOC FAQs
A home equity loan gives you a lump sum of money upfront with a fixed rate and predictable monthly payments. A HELOC, on the other hand, works more like a credit card, letting you borrow as needed during a set draw period, typically with a variable interest rate.
You can typically borrow up to 80 to 90% of your home’s appraised value, minus your current mortgage balance. The exact amount depends on your home’s equity, credit history, and income.
In many cases, yes, but only if you use the funds to buy, build, or substantially improve your home. At Wauna CU, we always advise our members to check with a tax professional for guidance specific to your financial situation.
Homeowners often use their home’s equity for renovations, debt consolidation, or major expenses like education or medical bills. These lending options are flexible, which means you can use them for a variety of needs.
Yes, a home equity loan or HELOC typically involves closing costs. We will work with you each step of the loan process so you will know upfront what fees are involved.