A Home Equity Line of Credit (HELOC) is a popular way to turn home ownership into cash when you need it. You can turn the equity in your home into a line of credit that functions like a credit card. According to Business Insider, whether a HELOC is the right move for your finances depends on a few factors:
Financial discipline
How likely are you to use and manage your credit line responsibly? If you tend to overspend, a HELOC could be a dangerous venture.
Financial goals
What are your goals for borrowing the money? If it's to fund a one-time purchase or bill, HELOCs may not be the right choice. However, if you need to cover recurring costs or a project for which you don't have an end total (like an ongoing home renovation, for example), it might work perfectly.
Alternative financing options
You should also look at the other financial tools you have at your disposal. If a high-rate credit card or personal loan are your only alternatives for cash, then a HELOC can often be a more affordable choice. If you have savings on hand, though, taking out any kind of debt is ill-advised.
Consult with a financial advisor
If you're torn on whether a HELOC is a good move, consult a financial advisor. They can offer you personalized guidance and recommend the right product for your goals and budget.
You can read the full article here, including the pros and cons of a HELOC.
If you have considered the pros and cons and decided a HELOC is right for you, follow these easy steps to apply today:
- Use First Federal’s Credit Line Calculator to see how much you could be eligible for.
- Complete this short form to begin the contactless account opening process.
A member of our team will be in touch during normal business hours. We’ll walk you through the process, making it as simple as possible!