The short version
These examples cover three common reasons homeowners look at a HELOC: paying off high-rate credit card debt, funding a rental property purchase, and paying for a necessary repair. In each one the HELOC is secured by the home, the rate is variable, and the outcome depends on the repayment plan.
The examples
Same Monthly Payment. Debt-Free an Estimated 17 Months Sooner.
A homeowner moved $45,000 of credit card debt at 24% to a HELOC at 9% and kept paying $1,350 a month. Estimated result: debt-free 17 months sooner, with $22,921 less interest before fees. A HELOC is secured by your home and its rate is variable.
Based on an actual customer experience. The customer’s name and identifying details have been omitted to protect their privacy. Any projected outcomes are identified as estimates.
Using Home Equity to Buy a Rental Property
A homeowner wanted to buy a rental property without using all of their savings. They weighed a HELOC on their current home, counted every ongoing cost, and tested whether their income could carry both loans through a vacancy. Rental income is not guaranteed, and the HELOC is secured by the home.
Based on an actual customer experience. The customer’s name and identifying details have been omitted to protect their privacy. Any projected outcomes are identified as estimates.
Completing a Necessary Home Repair While Preserving Savings
A homeowner needed a roof replacement and wanted to keep their cash reserves. They got contractor estimates, set a budget, and checked that repayment fit their income before using a HELOC. Borrowing adds interest, fees and debt, and the HELOC is secured by the home.
Based on an actual customer experience. The customer’s name and identifying details have been omitted to protect their privacy. Any projected outcomes are identified as estimates.
Before you borrow
The examples share three habits: a defined amount, a repayment plan that fits regular income, and a check on what happens if rates or expenses rise. See HELOC pros and cons and HELOC requirements, or run your own numbers in the HELOC calculator.
A HELOC is secured by your home. Failure to repay can result in foreclosure. HELOC rates are variable, so payments can increase.
FAQ
Are these real customers?
Each example carries a label directly under its title stating whether it is based on an actual customer experience. Names and identifying details are omitted, and any projected outcomes are identified as estimates.
Will my results be the same?
No. Rates, payments and outcomes depend on your credit, equity, property and the full file, and on how you repay. HELOC rates are variable.
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Keep reading
HELOC Pros and Cons
The benefits and the trade-offs in one place.
HELOC Requirements
Credit, equity, income and property rules.
HELOC Calculator
Estimate your line and payment in a minute.