Last updated: December 2025
Quick answer
Most homeowners have thousands of dollars in untapped home equity. A home equity line of credit (HELOC) allows you to access this hidden wealth without selling your home or refinancing your entire mortgage.
If you’re wondering how to use home equity, start by understanding your options.
Access cash within days
Tap into your home’s potential in minutes. Start our streamlined digital application to discover if a HELOC is right for you.
The value sitting in your home
Your home is likely your most valuable asset, but many homeowners don’t realize they can leverage that value while still living in it. As you pay down your mortgage and your property appreciates, your home equity increases. You can convert that equity into cash with a HELOC.
If you’ve owned your home for a few years, you may have built tens or even hundreds of thousands of dollars in equity. This equity isn’t just a number on paper; it’s a source of funding that you can use for renovations, debt consolidation, education expenses, or unexpected financial needs.
Read: What is a HELOC and How Does It Work?
How a HELOC turns equity into usable cash
A home equity line of credit (HELOC) is a revolving line of credit secured by your home. It functions like a credit card but with a much lower interest rate because it uses your home as collateral.
With a HELOC, you’re approved for a maximum credit limit based on your available equity. You can draw from that limit as needed, only paying interest on the amount you use.
Key features of a typical HELOC:
- Draw period: Usually 5–10 years, where you can borrow and repay as needed
- Repayment period: Follows the draw period, typically 10–20 years
- Interest rates: Often variable, but significantly lower than credit cards or personal loans
- Usage: Funds can be used for anything, including home improvements, medical bills, or education
A HELOC allows you to tap into home equity without refinancing or altering your first mortgage. This flexibility makes a HELOC one of the most powerful financial tools for homeowners.
Read: How does a HELOC work?
How to know how much home equity you have
You can calculate your home equity by subtracting your current mortgage balance from your home’s appraised market value.
Example:
- Home value: $500,000
- Mortgage balance: $320,000
- Home equity: $180,000
Most lenders allow you to borrow up to 85% of your home’s value (combined with your current mortgage), which means you could access a portion of your $180,000 equity.
A HELOC doesn’t require you to refinance your existing mortgage, which means you keep your current rate and loan term intact. The HELOC adds a second lien without changing your first mortgage.
How to: Check your HELOC rate in minutes
When tapping your equity makes the most sense
Homeowners often turn to a HELOC in these scenarios:
- Home renovations: Upgrade your kitchen or add a room using your own equity
- Debt consolidation: Pay off high-interest credit cards at a lower HELOC rate
- Emergency expenses: Cover unexpected medical or repair costs
- Education funding: Finance tuition or student housing without taking out student loans
- Investment capital: Use equity to fund business ventures or purchase additional property
Is a HELOC worth It? Compared to personal loans, HELOCs offer lower rates, longer terms, and flexible borrowing limits.
How to: Use our HELOC calculator.
Why many homeowners overlook their equity
Many people only think of home equity when they sell their property or refinance. But that’s not the only time you can access it.
Common reasons homeowners miss out:
- They think they need to sell their home to “use” the equity
- They assume the process is complex or slow
- They don’t realize how much equity they’ve accumulated
- They’re unaware of HELOCs as a flexible borrowing option
The truth is, applying for a HELOC is often faster and easier than getting a new mortgage. Some lenders, like HomeEQ, offer same-day approvals and no appraisal requirements.
Read: How to apply for a HELOC
HomeEQ vs. traditional banks: who offers more flexibility?
Not all HELOC lenders are the same. When comparing HomeEQ to large national banks or traditional credit unions, several differences stand out:
| Feature | HomeEQ | Traditional Banks |
|---|---|---|
| Minimum credit score | 640 | 680–700+ |
| Application process | Fully online, fast approval | In-person, slower processing |
| Appraisal requirements | Often waived | Typically required |
| Draw limits | Up to 85% LTV | Usually capped at 80% LTV |
| Customer support | Dedicated HELOC specialists | General call centers |
While traditional banks may offer HELOCs, they often come with more restrictions, longer approval timelines, and less flexibility. Unlike lump-sum home equity loans, HELOCs give you flexible credit access over time. HomeEQ focuses solely on home equity products, streamlining the process and offering more favorable terms.
What makes HomeEQ the better choice?
HomeEQ was designed to serve homeowners who want a smarter way to access their equity. Instead of dealing with the rigid requirements of big banks, HomeEQ customers benefit from:
- Quick online applications with instant pre-qualifications
- No in-person paperwork or appraisals in many cases
- Access to higher credit limits and lower fees
- Transparent terms with flexible repayment options
- Support from experts who specialize in home equity solutions
By focusing exclusively on home equity products, HomeEQ offers tailored guidance and more competitive offers than traditional lenders.
Unlock your home’s hidden wealth
The equity in your home could be the key to meeting your financial goals. A home equity line of credit gives you flexible access to funds when you need them, without selling your home or refinancing your mortgage.
With competitive rates, fast approvals, and a borrower-friendly process, HomeEQ helps you turn your home’s value into real financial power. Whether you’re planning a renovation, consolidating debt, or simply building a cash cushion, HomeEQ makes it easy to get started.
Explore your options today and see how much equity you can access.
Frequently asked questions: Home equity line of credit
Q: What is a home equity line of credit?
A: A home equity line of credit (HELOC) is a revolving credit line secured by the home that allows you to borrow against your available equity.
Q: How much can I borrow with a HELOC?
A: Most lenders allow you to borrow up to 85% of your home’s value, minus your existing mortgage balance.
Q: Is a HELOC better than a home equity loan?
A: A HELOC offers more flexibility since it functions like a credit card: you borrow only what you need and pay interest only on that amount. A home equity loan provides a lump sum with a fixed rate.
Q: Does a HELOC affect my mortgage?
A: No. A HELOC is a separate loan and does not change your existing mortgage rate or terms.
Q: How fast can I get a HELOC approved?
A: With HomeEQ, you can get pre-qualified in minutes and approved in as little as 24 hours, depending on your situation.
