Home equity is the difference between what you owe on your mortgage and the current appraised value your home. For example, if your house was appraised at $300,000 and you owe $100,000, you have $200,000 in equity. This is also referred to as your loan-to-value or LTV.

If you haven’t had your home appraised since you renovated it or property values have gone up in your area, it might be worthwhile to get an appraisal before you apply for equity financing. If your home has increased in value, you’ll have more equity to draw from.

A home equity loan is a type of financing that uses your equity as collateral based on how much equity you have in your home. 

If approved for a Home Equity Loan, you will receive the full amount borrowed upon closing. Repayment works like any other installment loan, meaning you would make equal monthly payments over time until you pay off the loan balance

A Home Equity Loan requires a second mortgage on your house.

A Home Equity Line Of Credit or HELOC is a loan that uses your home’s equity as collateral, but instead of issuing the loan in a lump sum, a line of credit is extended based on your equity.

Unlike the single lump sum of a Home Equity Loan, a HELOC provides flexibility. There's still a total loan amount, but you only borrow what you need, then pay it off and borrow again. That also means you pay back a HELOC incrementally based on the amount you use rather than on the entire amount of the loan, like a credit card.

The period when you can spend money through your HELOC is called the draw period. After the draw period ends, you can no longer access the credit, and you enter your repayment period. We offer HELOCs with introductory rates fixed for two or five years, and draw periods up to 15 years. 

A HELOC also requires a second mortgage on your house.

A Home Equity Loan is a good option if you know how much you need to borrow. For example, if you’re consolidating debt, or making a single large purchase.

A HELOC is a good option for uses like construction or home renovations, as these costs can change over time. The HELOC allows you to use as much or as little of the credit as you want and you can continue to borrow as you pay down the principal.

We're here to answer all your questions and help you make the best possible decision and reach your financial goals.

Possibly. If you carry a lot of unsecured, high-interest credit card debt, consolidating that debt and paying it off with a secured Home Equity Loan or HELOC will improve your score and, because you will have reduced your interest rates, can help you pay down the debt faster. This will improve your credit score.

Homeowners can use a home equity loan for anything they like, but it's wise to avoid using equity to finance purchases that can't be recouped, like vacations. It's better to leverage your equity in ways that will help build your wealth, such as improving your home to add value, or consolidating and paying down high-interest debt.

There are several ways you can access your HELOC funds

• Make transfers as needed in Digital Banking
• Order checks for your HELOC account
• Call us at (636) 720-2400
• or visit a branch near you.

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