What the heck’s a HELOC?

A Home Equity Line of Credit (HELOC) is an open line of credit that lets you borrow against your home equity. It is secured by your home, cottage, or rental property and allows you to borrow and repay money as you please. The amount of credit you can get depends on how much you still owe on your mortgage, and the maximum line of credit you can get is 65% of the value of your property, 80% if combined with a mortgage. It is recommended to get a HELOC as soon as you can, and borrowers can access credit whenever they need it and pay it back on their own terms. HELOCs can also be used to put money down on a second property. It is important to have a repayment plan to avoid accruing high-interest rates and owing more on the home than you are comfortable with. The difference between a regular line of credit and a secured line of credit like a HELOC is that the latter is secured against an asset, and the interest rate is lower.