HELOC & Home Equity Loans
A HELOC (home equity line of credit) lets you borrow against your home’s equity while keeping your current first mortgage, and its rate, in place.
If you locked in a low rate on your first mortgage, a HELOC or a fixed-rate home equity loan can give you access to cash without giving up that rate. It’s a second mortgage, secured by your home.
Who it’s for
How it works
HELOC: works like a credit line. You draw what you need during the draw period and pay interest only on what you use. HELOC rates are usually variable. After the draw period ends, the balance is repaid over a set term.
Home equity loan: a lump sum with a fixed rate and a fixed payment. It’s a good fit when you know exactly how much you need.
How much you can borrow depends on your combined loan-to-value: your first mortgage plus the new line, compared with your home’s value. Limits vary by program and property type.
What you need to qualify
- Equity in your home after accounting for your first mortgage
- Credit and income that support the added payment
- Owner-occupied homes qualify most easily. Second homes and rentals have more limited options.
- A property valuation, which may be an appraisal or an automated valuation
Documents to have ready
- Your first-mortgage statement
- Pay stubs, W-2s and/or tax returns
- Homeowners insurance declarations page
- Photo ID
How it works with Amerifi Lending
Frequently asked questions
HELOC or cash-out refinance?
Keep your low first-mortgage rate with a HELOC. Consider a cash-out refinance if today’s rates beat your current one, or if you want one fixed payment. We’ll run both numbers.
Can I pay a HELOC off early?
Usually, yes. Some lines have an early-closure fee if you close the line within a set time, and we’ll point out any fees up front.
Is HELOC interest tax-deductible?
Sometimes, depending on how you use the money. Ask your tax professional. We can’t give tax advice.
Helpful guides
Related loan options
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