DayCents

HELOC (Home Equity Line of Credit)

A HELOC is a revolving line of credit secured by your home equity — like a credit card backed by your house. You borrow as needed up to a limit during a draw period, paying interest only on what you use, usually at a variable rate.

Because it's secured by your home, a HELOC carries lower rates than unsecured debt — but missing payments can put the house at risk. It's commonly used for renovations or as a flexible reserve, and the draw period is eventually followed by a repayment period.