Home equity line of credit (HELOC)

is a secured personal line of credit extended to a homeowner that uses the borrower’s home as collateral. The maximum borrowing limit on a HELOC is based on a fi xed percentage of the diff erential between the assessed property value and the mortgage obligation. HELOCs typically represent the least expensive form of non-mortgage credit. This factor, coupled with greater availability from financial institutions, relatively low interest rates and rising home values, have made HELOCs an increasingly popular form of consumer borrowing.

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