A Home Equity Line-of-Credit (HELOC) allows you to borrow money using the equity in your home as collateral. It is the most flexible, valuable, and safest type of consumer loan a homeowner can get by unlocking your home’s purchasing power. You can borrow money when you need it, without having to apply for a new loan every time you need money.
Top Reasons to use your HELOC:
Home Improvement – Making improvements to your home is a very common reason to use a HELOC. Home improvements can add value to your home and certain upgrades can even give you tax benefits and lower energy bills. For example, a moderate kitchen remodel adds 72% of its cost to your home’s value. Upgrading exterior siding can add 78% of the cost(link is external). Per the U.S. Department of Energy(link is external), you can claim the Residential Energy Efficient Property Credit(link is external) for solar, wind, and geothermal equipment from your principal residence. The tax credit is 30% for systems placed in service by December 31, 2019. When you use a home equity line-of-credit for home improvements, you are essentially borrowing money against your home and then reinvesting those funds back into the property.
Debt Consolidation – Looking for financial freedom? A home equity line-of-credit can save you a lot of money in the long run by consolidating high-interest debt. Homeowners will often use a HELOC to pay off personal debts such as credit cards, high-interest personal loans, and high-interest car loans. Your typical credit card interest rate averages between 15 to 20 percent, depending on your credit score. Let’s say you have $20,000 in credit card debt, and your interest rate is 17%. By using a home equity line-of-credit to pay off the debt, you could save yourself about $2,000 in interest and use it to pay down the principal balance of the debt instead. A HELOC is a safe way to consolidate debt, lower your monthly payment, and lower your interest.
Pay for College – The current student loan debt(link is external) in our country is around $1.52 trillion and around roughly 44.2 million Americans have existing student loan debt. As college tuition continues to rise, a HELOC has become a popular option for parents across the country to pay(link is external) for their children’s college tuition. The primary reason for this popularity is due to low rates compared to other lending products. Paying for education is an investment in your child’s future. That is a huge positive for using your home equity line-of-credit.
Why a Notre Dame FCU HELOC?
Most financial institutions charge monthly or annual maintenance fees for having an active home equity loan. A HELOC with Notre Dame FCU has a special introductory rate of 1% APR, zero maintenance fees, no closing costs, and a 30-year term.* It’s important to look at all your options and understand how a home equity line of credit can work for you.
To learn more, please visit NotreDameFCU.com/HELOC or contact a Notre Dame FCU Representative for further details. Equal Housing Lender. NMLS #405299.