Over the years you have spent in your home, you have invested into it every month. Now, you need some extra cash.

What if there were a way you could use the equity you have built up in your home to get the funds you need? That is exactly what you can do with a home equity line of credit, often called simply a “HELOC” for short.

What is a HELOC?

A home equity line of credit is described pretty well by its name. It is a line of credit which you borrow against the equity in your home. That equity acts as security.

A HELOC works differently from a cash-out refinance. With a cash-out refinance, you receive a lump sum in the amount you are borrowing. With a HELOC, what you have is a revolving line of credit much like a regular credit card. It is up to you how much of that line of credit you want to use, so long as you meet the minimum draw requirement.