HELOCs are Getting Popular Again

  • Banks are proactively pushing home equity lines of credit (HELOCs) to homeowners whose properties have regained much of the value they lost during the housing crisis. With rates averaging 4 percent to 7.25 percent, home equity borrowing is regaining appeal. 
  • A home equity line of credit works a bit like a credit card. 
  • You get a variable interest credit line of up to a certain dollar amount and can tap it as often as you like. 
    You generally pay interest only for up to 10 years, what’s known as the “draw period.” After that, you must begin paying back interest and principal. 
  • The amount you can borrow — typically ranging from $10,000 to $1 million — depends on things such as the value of your home, how much you owe on your first mortgage and your credit score.
  • Lenders are now requiring higher credit scores. The average credit score for HELOC borrowers in 2015 was 774, more than 30 percent higher than a decade ago, according to CoreLogic. 
  • In addition, lenders have grown more conservative about how much they’ll lend. Today, the average HELOC loan-to-value ratio is just over 60 percent.



- Sunil Sethi


Helping Families Find Homes with Great Schools in Fremont, Newark and Union City.

Property Search | Featured Listing | Neighborhoods | Home Value | School Score | Property Tax

To access most updated listings on MLS from your phone, Download my FREE app from "My Mobile App".
Want to know if you qualify for any special loan programs. Check out CAR's Mortgage Directory
Love Us on Yelp!
Like Us on Facebook