What Can You Use a HELOC For
For those who own a home, a home equity line of credit (HELOC) can be a great option to fund a lot of things. With a HELOC, you can use the equity in your home to access money for almost anything, not just home renovations. You can consolidate debt, pay for educational expenses, and more. It's also a much more affordable option than things like credit cards, which usually have much higher interest rates. Even if you don't actively use your HELOC, you can also have it for emergencies, such as a flooded basement or medical expense.
Home Improvements and Major Home Repairs
Think remodeling your kitchen, making updates to your landscaping, or repairs due to a leaky pipe or a tree falling on your roof. A HELOC may help you to increase your home's value and turn your house into a home you love living in (and keep it that way). However, be aware that you might only make some of the money back you invest into your home (check out our article on projects that add the most value to your home). First, think about the projects that would be the most important to you and your family and research the associated costs. Then, you can weigh those costs against the resale value the project would add to your home if you sell it. This way, you can make sure the payoff will be worth it!
Student Loans and Educational Expenses
Whether you're paying for tuition, a tutor, or education-related expenses, you can use a HELOC to pay for them. Always consult your tax advisor before making a decision, as you may be able to take a tax deduction on interest paid from student loans.
Major Life Events
Some life events are just plain expensive. Whether you're getting married or having a baby, a HELOC can help fund these and other life events without draining your emergency fund and help keep your budget intact.
Medical Bills and Other Unexpected Expenses
We all know life happens. Expensive car repairs and medical bills are things we all experience at some point. Sometimes, it just isn't possible to prepare for those unexpected costs, and a HELOC can help get you through tough times. If you're considering having a HELOC available for emergencies double-check to see if there is a yearly fee for having a HELOC open. WaFd Bank does not charge an annual fee* for a HELOC, and you only owe if you borrow.
Paying Off Debt or Consolidating Debt
If you have credit cards or loans that have high-interest rates, you can consolidate those debts to get a single monthly payment. Often, the interest rate on a HELOC is lower than credit cards and other loans, which will help you pay off debt much faster and pay less in interest. Check out WaFd Bank's HELOC rates to compare to the interest rate you pay on your current debts.
WaFd Bank is Here to Help
No question is too small for our friendly bankers! Find a branch near you, speak with a local loan officer, or give us a call at 800-324-9375 to learn more about how a HELOC can help you reach your financial goals.
Check out WaFd Bank's HELOC calculator!
Use your home's equity to finance your next big project. Whether it's to pay for a home renovation or remodel, or pay consolidated bills, a no annual fee HELOC from WaFd Bank is often more affordable than using credit cards or other loans.
Try it nowAll loans are subject to credit approval. Texas HELOCs: Notice concerning extensions of credit defined by section 50(a)(6), article XVI, Texas constitution: Section 50(a)(6), article XVI, of the Texas constitution allows certain loans to be secured against the equity in your home. Such loans are commonly known as equity loans.
*Property insurance is required. A discount of 0.250% off your interest rate is given for automatic monthly payments from your WaFd Checking account. Interest rate and APR (Annual Percentage Rate) are variable based on the Wall Street Journal Prime Rate plus a margin subject to credit approval of your credit history, loan to value, occupancy, and EZ Pay requirements. The rate will never exceed 17.99% APR. Fees range from $354 - $7,579, which are included in the disclosure provided at loan application and again at closing. HELOC fees vary depending on the HELOC loan amount and property location. HELOCs feature a 25-year term as follows: a 10-year draw period to borrow on your line of credit whenever you need it; any outstanding loan balance after the 10-year draw period will be amortized (principal and interest payments) over 15 years. Monthly interest-only payments do not include property taxes and insurance.
