What is a Home Equity Line? - A home equity line is a line of credit secured by your home. It may be more attractive than using a credit card because of its significantly lower interest rate. The home equity line is a revolving line of credit, which means you do not need to make the full repayment amount. There is a minimum payment each month just like a credit card statement.
Benefits of a Home Equity Line
This type of credit line is convenient for homeowners who need immediate access to cash funds. There are no rules regulating what it can be used for, so it can be spent on anything. Many homeowners use this credit line to help pay for their children’s tuition, home improvement or just as a last resort when money runs out. The interest rate paid on the home equity line could possibly be tax deductible because it is secured by collateral (the house).
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