HELOC: What It Is, How It Works & How to Get One
A HELOC (Home Equity Line of Credit) lets you borrow against your home’s equity with flexible access to funds, similar to a credit card.
What Is a HELOC?
A home equity line of credit (HELOC) is a revolving credit line secured by your home.
Instead of receiving a lump sum, you’re approved for a maximum limit and can draw from it as needed during a set period of time. Common uses include:
- Home Improvement
- Debt Consolidation
- Emergency Expenses or Large Purchases
See how much equity you've built
Your home is more than a place to live — it's a financial asset. Enter two numbers to estimate your equity.
Your estimated home equity
$150,000
That's 37.5% of your home's value
Loan-to-value (LTV)
62.5%
Potentially available at 80% LTV*
$70,000
Your loan balances are higher than your home's value, so equity is currently $0. Talk to us about your options.
Put your equity to work →*Many home equity loans and HELOCs allow borrowing up to 80% of your home's value, minus what you owe. This calculator provides estimates for illustration only and is not a loan offer, approval, or appraisal. Contact FBKC Mortgage for options based on your situation.
How Does a HELOC Work?
Draw Period (typically 5–10 years)
- Borrow as needed
- Interest-only payments may be availalbe
- Funds can be reused
Streamlined online process
From online application to e-closing options, our digital mortgage platform makes the process quick and convenient.
Repayment Period (typically 10–20 years)
- No additional draws
- Repayment of principal and interest
HELOCs typically have variable interest rates, so payments may change over time.
Benefits of a HELOC
Flexible access to funds
Pay interest only on what you use
Lower rates than many credit cards
Reusable credit line
HELOC vs Home Equity Loan:
What’s the Difference?
HELOC
- Revolving credit line
- Variable rates
- Flexible usage
Home Equity Loan
- Lump sum
- Fixed rates
- Best for one-time expenses
How Much Can You Borrow?
Typically lenders allow borrowing up to 80–90% of your home’s value, minus your remaining mortgage balance. FBKC has HELOC products allowing up to 100% LTV.
Some basic HELOC Requirements:
- Sufficient home equity
- Credit score 620+
- Stable income and employment
- Reasonable debt-to-income ratio
Frequently Asked Questions About HELOCs
With reliable and easy to understand answers.
What is a HELOC and how does it work?
A HELOC (home equity line of credit) is a revolving credit line secured by your home. You’re approved for a maximum limit and can borrow as needed during the draw period, then repay the balance over time.
How is a HELOC different from a home equity loan?
A HELOC is a flexible, revolving line of credit with a variable rate, while a home equity loan provides a lump sum with a fixed interest rate and set monthly payments.
What credit score do you need for a HELOC?
620, but higher scores typically qualify for better rates and higher borrowing limits.
How much can I borrow with a HELOC?
You can borrow up to 100% of your home’s value with FBKC, minus your remaining mortgage balance. The exact amount depends on your credit, income, and other factors.
Do HELOCs have fixed or variable rates?
Most HELOCs have variable interest rates, meaning your rate and monthly payment can change over time based on market conditions.
What can you use a HELOC for?
Common uses for a HELOC include home improvements, debt consolidation, emergency expenses, and large purchases. Funds can be used as needed during the draw period.
Does a HELOC affect your credit score?
Yes. Applying for a HELOC may result in a hard credit inquiry, and your balance and payment history can impact your credit score over time.
How long does it take to get a HELOC?
The process typically takes 2 to 6 weeks, depending on documentation timelines, and whether an appraisal is required.
Can you pay off a HELOC early?
Yes. Most HELOCs allow early repayment, though some lenders may charge a fee if the account is closed within a certain timeframe.