What is a Home Equity Line of Credit?
A HELOC is a revolving credit line secured by your home. Rates and payments may change, and repayment terms differ from the draw period. Your home is at risk if you cannot repay.
This guide is a starting point for an informed conversation. It does not confirm eligibility, approval, pricing, or program availability. Mortgage terms and requirements can change, so ask Texas Mortgage Info for current information about the property and your situation.
Borrowing during the draw period
A HELOC provides a maximum credit line and may allow repeated draws during a stated period. Available credit, minimum draws, access methods, and fees depend on the agreement.
Rates and payments may change
HELOCs commonly have adjustable rates. Payments can depend on the outstanding balance and may change again when the draw period ends and repayment begins.
Your home secures the account
A HELOC is secured by the property. Missing required payments can put the home at risk, so compare the purpose of the borrowing with safer or less costly alternatives.
What happens to your payment when the draw period ends?
Ask for an explanation based on current guidelines and written disclosures before making a financing decision.
Details worth gathering.
- Your current mortgage balance and estimated property value
- The purpose, amount, and expected timing of draws
- Questions about rate adjustments, fees, minimum payments, and repayment
Home Equity Line of Credit FAQ
Is a HELOC the same as a home equity loan?
No. A HELOC is generally a revolving line, while a home equity loan typically provides a lump sum. Terms vary.
Can the payment change after the draw period?
Yes. The payment structure may change when repayment begins, and an adjustable rate can also affect the amount due.