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Home Equity Loans & HELOCs

Use Your Home as Collateral

With home equity loans and home equity lines of credit (HELOC), you use the equity you’ve built up in your home to determine how much you can borrow for your loan.

Home Equity Loans / Home Improvement Loans

Use the equity in your home for home improvements, college tuition, vacations or any other big-ticket purchase you choose. Here are some features:

  • Flexible terms
  • Fixed rate
  • No annual fee
  • No prepayment penalties

Home Equity Loan Qualification Criteria

Credit score: Typically, a credit score of 640 is the minimum to obtain a home equity or HELOC loan, and 750 is the minimum score you need to get the best rates available.

Ability to repay: Borrowers must show they have the ability to repay the loan based upon their current income.

Debt-to-income ratios: One of the main factors when determining your ability to afford a loan is your debt-to-income (DTI) ratio. Your DTI ratio is the relationship between your monthly debt payments and gross monthly income. This ratio needs to be reasonable to qualify for a conventional mortgage loan, meaning the amount you spend on monthly payments needs to be “reasonable” compared to your monthly income. Typically, your ratios need to be less than 43%, but it is possible for them to be higher.

Home Equity Lines of Credit (HELOCs)

Use the equity in your home when and where you want it., when you need it and for whatever purpose you choose.

  • Interest-only payment due monthly
  • Variable rate
  • Convenience—advance funds on your line of credit easily
  • Use money from your line of credit when you need it and then pay it back. (In contrast, a home equity loan is received in full at the closing of the loan with monthly payments.)

Home Equity Line of Credit Qualification Criteria

Credit score: Typically, a credit score of 640 is the minimum to obtain a home equity or HELOC loan, and 750 is the minimum score you need to get the best rates available.

Ability to repay: Borrowers must show they have the ability to repay the loan based upon their current income.

Debt-to-income ratios: One of the main factors when determining your ability to afford a loan is your debt-to-income (DTI) ratio. Your DTI ratio is the relationship between your monthly debt payments and gross monthly income. This ratio needs to be reasonable to qualify for a conventional mortgage loan, meaning the amount you spend on monthly payments needs to be “reasonable” compared to your monthly income. Typically, your ratios need to be less than 43%, but it is possible for them to be higher.

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