How to Make Your Home Equity Work For You


How Do I Make My Home Equity Work For Me?

It’s a satisfying feeling when you know your house is worth more than what you owe on the mortgage balance, and that you’re sitting atop a nice cushion of equity. But what good is all that cash if you have to sell your home to access it? Enter: the Home Equity Line of Credit, or HELOC, as those in the industry like to call it. 

HELOCs help homeowners access cash by borrowing against the equity in their house. Often, the interest rates you’ll pay on a HELOC will be lower than personal loans or credit cards. Smart homeowners watch the market and use their equity to their advantage when the timing and the situation are right. If you qualify for a home equity line of credit, you can use it to finally do that kitchen remodel, or to pay off outstanding debt and create one payment at a lower interest rate. It’s up to you how much to take out, and for what to use it. 

The big thing to remember with a HELOC is that it’s just like your mortgage – if you don’t make the payments, the bank can take your house. Make sure you can afford the new payment, and research smart uses of HELOC cash – like a home project that will boost your market value – making sure to notice which uses are deemed ‘deductible’ by the friendly IRS. 

It’s always a good idea to take the first steps of researching and understanding what opportunities are available to you as a homeowner, even if you don’t have a reason for liquid funds now. When that roof and water heater go at the same time Junior gets into NYU, you’ll be glad that your banker already talked you through your HELOC options. Connect with a reputable local banker with savvy HELOC skills and be the smartest borrower on the block.

Opportunity Bank of Montana


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