6
No, the HELOC limit cannot be increased. However, you may be able to
refinance your current HELOC into a new HELOC with a higher credit limit,
provided you meet qualifying criteria.
Can I have my draw period extended?
Normally, at the end of the ten-year draw period you must start making
principal-and-interest payments and can no longer borrow new funds on the
HELOC. If you meet current credit criteria, you may be able to refinance
your outstanding balance into a new HELOC or mortgage loan. In some
limited circumstances, we may be able to extend the draw period in a
process similar to establish a new HELOC.
Can I change the interest rate on my HELOC from a variable to a fixed rate?
No, our home equity line of credit does not have a conversion option;
however, you may be able to refinance the HELOC into a fixed home equity
loan.
What makes a HELOC an attractive financing option?
Interest rates for HELOCs are typically lower than other forms of credit,
such as personal loans or credit cards. Because your home is used as
collateral, you reduce the risk to the lender, and therefore qualify for a lower
interest rate. A lower rate means a lower cost to you. The interest you pay
on a HELOC may also be deductible on your income tax return; consult a
tax professional to determine if that will be true in your circumstances.
Which is better: HELOC or a Home Equity Loan?
Both are similar in that you are borrowing against your home’s equity and
your rate is probably lower than rates with other types of personal loans.
The best option depends on your borrowing needs and your level of comfort
with the risk of changing rates.
• A HELOC is a credit line: you borrow what you need up to your
approved credit limit, and make payments based on how much you
have borrowed. When you pay down your balance, you then have
more money available to spend again if necessary. You can use one