Access up to $500,000 from your home
What are HELOCs?
You can borrow money using the equity you’ve already accrued in your house with a HELOC, sometimes referred to as a home equity line of credit. A HELOC offers flexibility in terms of both borrowing and paying back money because it is a line of credit.
How does it work?
HELOCs function relatively similarly to credit cards. You can borrow money up to the lender’s predetermined credit limit and then repay it to them together with interest. This choice may give you more flexibility; if required, you can even withdraw money and make payments on a daily or monthly basis.
How much can you borrow?
The credit limit of a HELOC is mostly based on the market value of your house and the balance owed on your mortgage. Other criteria that affect the credit limit include your credit score and outstanding obligations.
Let’s make the math straightforward. Say the value of your house is $100. You are permitted to borrow up to 97 percent of the home’s worth (LTV), or $97. You have a $50 mortgage balance. You may borrow a total of $47 dollars.
Home’s market value: $500,000
97% of home’s value: $485,000
Minus mortgage balance: $250,000
Potential line of credit: $235,000
Of course, determining eligibility is only the start. To learn more about the process of opening a HELOC, speak with one of our loan professionals today.