What's the difference between an HE loan and a HELOC?
Both options allow you to borrow against the appraised value of your home, providing you with cash when you need it. Generally speaking, you can borrow up to 85% of your home's value with an HE loan; think of it as a second mortgage. HELOCs start with a borrowing period for when you can access the money, followed by a repayment period, when borrowing must stop and payments are required.
- Has a credit limit and a specified borrowing period, usually 10 years.
- Only pay interest on the money you use.
- Most charge variable interest rates.
- During the borrowing period, you will need to at least make payments on the amount you owe.
- Once the borrowing period ends, you'll repay the remaining amount with interest, just like a loan.
- Gives you the flexibility of a financial backstop that's there when you need it.
- You apply for only the amount you need.
- Most charge a fixed interest rate that doesn't change.
- Each monthly payment includes the interest charges and a portion of the loan principal.
- Can give you a lump sum of cash at loan closing.
To apply for an HE loan, please visit https://www.decu.com/borrow/re...