HOME EQUITY LOAN
A Home Equity Loan is very similar to other loans. The lender gives you a lump
sum, expecting repayment plus interest and other fees. Home Equity Loans are secured by your home and are good for use on a specified project for a set amount. Many people find that Home Equity Loans are convenient for debt consolidation, paying for education expenses and paying for weddings, as the interest rate is often lower, and usually tax-deductible (please consult your tax advisor).

HOME EQUITY LINE OF CREDIT
A Home Equity Line of Credit (HELOC) is another type of home equity. However, a HELOC is considered a revolving credit account. It is flexible. It works like a credit card - you can borrow money, and as you pay it down, you can borrow more. A HELOC comes with a limit that usually corresponds somewhat to the equity you have in your home. Money from a home equity line of credit is fairly accessible. You don’t have to apply for a new loan to get more money if you need more than you thought you did. However, you do have to stay within your limit. Like a Home Equity Loan, the HELOC often has tax-deductible interest payments.

A HELOC is most convenient for home improvements. Because of the nature of major remodeling or improvement projects, things can easily cost more or less than you thought. A HELOC makes it easy for you to borrow money as you need it.