You've built equity. Now put it to work. Whether it's home improvements, debt consolidation, or a major purchase — a HELOC or home equity loan gives you flexible access to your home's value.
A HELOC (home equity line of credit) is a revolving credit line you draw from as needed, with a variable rate and interest-only payments during the draw period. A home equity loan is a one-time lump sum with a fixed rate and fixed payments. HELOCs work best for ongoing projects or rate-flexibility; home equity loans suit single-purpose borrowing like one major renovation or debt consolidation.
A HELOC works like a credit card secured by your home. Draw what you need, when you need it, and only pay interest on what you use.
Home equity products typically carry much lower rates than credit cards or personal loans because they're secured by your property.
Interest on home equity borrowing used for home improvements may be tax-deductible. Consult your tax advisor for details on your specific situation.
Home renovations, debt consolidation, education expenses, emergency funds, investment opportunities — your equity, your choice.
Three different products let you tap your home's equity, and they aren't interchangeable. The right choice depends on how you'll use the money, how predictable your needs are, and what your existing mortgage looks like.
Every HELOC has two distinct phases. Understanding both upfront prevents surprises when phase one ends.
Borrow up to your credit limit as needed. Pay interest only on what you've drawn, not on the unused portion. Minimum payments during this phase are usually just the interest — very low. Many homeowners find this phase forgivingly easy on cash flow. Draw periods of 3, 5, and 10 years are available, with flexible shorter draw periods for borrowers with lower credit scores.
What to watch: Variable rates can rise. A draw made at 8% might be repaid at 11% if rates climb.
The draw window closes. No new borrowing allowed. Your balance amortizes over the repayment period (typically 20 years) — principal + interest. Payments often double or triple compared to the draw period because you're now paying down principal.
What to watch: The payment jump catches many homeowners off guard. We model it for you upfront.
Home renovation: The most common use, and the only one where HELOC interest may be tax-deductible. The IRS allows deductibility when the proceeds are used to "buy, build, or substantially improve" the home that secures the loan. Always confirm with your tax advisor — we can't give tax advice.
Debt consolidation: Pay off high-interest credit cards (often 20%+ APR) with HELOC funds at a much lower rate. Math usually works, but the discipline question matters — if you run the credit cards back up, you've just added more debt against your home.
Education funding: HELOC rates often beat private student loan rates for borrowers with good credit. Federal student loans (especially subsidized) are usually still better — but for parents with home equity, a HELOC can fill gaps without taking on Parent PLUS loans.
Bridge financing: Buying a new home before selling the old one. HELOC on the current home funds the down payment on the new home; pay it off when the old home sells. We've closed dozens of these for Michigan move-up buyers.
A HELOC is a revolving line of credit — you draw funds as needed during a draw period. A home equity loan is a lump sum with fixed payments. We'll help you determine which fits your needs.
Most lenders allow you to borrow up to 80-85% of your home's value, minus what you owe. On a $400,000 home with $200,000 owed, you could potentially access $120,000-$140,000.
No. A HELOC is a second lien — it doesn't change the terms of your existing mortgage. Your first mortgage stays exactly as it is.
Most HELOCs close in 2-3 weeks. The process includes an appraisal, title search, and standard underwriting.
The information on this page reflects current program guidance from the agencies below. For the most authoritative and up-to-date details, refer directly to these primary sources or speak with our team.
Express Home Loans, LLC (NMLS #2485075) is an independent mortgage broker and is not affiliated with, endorsed by, or acting on behalf of HUD, the VA, the FHA, the CFPB, Fannie Mae, Freddie Mac, MSHDA, or any government agency. Links are provided for reference only. Program terms and availability are subject to change and to lender and agency approval.