Home Equity Line of Credit

The equity you've built can help you make improvements, add new space, or even pay for new adventures.

Family sitting on steps. HELOC 6.00% APR 6-Month Intro Rate. 8.25% APY Adjusts to Qualified Rate.

What is a Home Equity Line of Credit?

A Home Equity Line of Credit is a form of revolving credit that allows you to take advantage of the equity you've built up in your home. When you use your home's equity, you're borrowing funds directly from your own equity, then repaying it — usually at a relatively low-interest rate.

Because it acts as a line of credit rather than as a standard loan, you'll have access to funding in any amount (up to the total amount of equity you have) whenever you need it. And you only pay interest on the portion of the home equity line of credit you use.

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How does a home equity line of credit work?

With a HELOC, you can access a certain amount of money, up to a predetermined credit limit, over a set period of time, usually 10 years. You can use this money for anything you want, such as home renovations, debt consolidation, or other major expenses.  HELOCs can potentially lower your monthly bills and boost your credit score by paying off high-interest credit cards, medical bills, and other debt. 

Unlike a traditional loan, you don't receive the entire amount upfront. Instead, you can borrow and repay money as needed within the set time frame. You only pay interest on the amount you borrow, not the entire credit limit.

HELOCs typically have variable interest rates, which means that the interest rate can fluctuate over time based on market conditions. The interest rate on a HELOC is usually lower than other types of loans, such as credit cards or personal loans, but it can still be higher than your mortgage interest rate.

 

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What are the benefits of a home equity line of credit?

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Flexibility

With HELOCs you can draw on the line of credit at any time during the draw period, and you only pay interest on the amount you borrow.  This means that you can use the funds for a variety of purposes. 
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Lower rates

HELOCs typically have lower rates than other types of loans because the loan is secured by your home's equity making it a cost-effective way to borrow and pay off other high-interest debt. 

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Ease of application

The application process is simple and straightforward.  Before you begin your application, it may be helpful to take a minute and review our home equity document checklist.

 

 

How long does it take to get a home equity line of credit?

Step 1. Complete a basic application.

Apply online in minutes, call 888-873-2640, or visit a Horizon Bank branch.

Step 2. Work with an Advisor.

An experienced Horizon Loan Advisor is here to guide you through the process. 

Step 3. Close on your HELOC.

Once your loan is approved your Loan Advisor will schedule your closing.

 

 

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APR Disclosure

*Introductory APR (Annual Percentage Rate) will be fixed at 6.00% APR for the first 6 months for those lines with up to 89.9% loan to value (LTV). Thereafter, the rate may vary. The rate is based on credit score, LTV and Prime Rate + 0.25%. The Prime Rate equals the highest Wall Street Journal (WSJ) prime rate as published in the WSJ effective the date the 6-month introductory period expires. WSJ prime rate effective 12/19/2024 is 7.50% APR. Example: credit score of 730+ and LTV of 70% or less will have a rate of 7.75% as of date of publication following the introductory period. Maximum rate is 25%. APR will not fall below a floor of 3.25%. Annual fee is $50, waived for first year. Reimbursement fee up to $399 applies if line is closed within the first 36 months. Subject to credit approval. Other terms and conditions may apply and are subject to change without notice. Introductory rate not available on home equity lines of credit opened within the last 12 months unless line amount is increased and a 25% advance is taken at funding. The 25% advance does not include the payoff disbursement. Offer expires March 31, 2025.

Get answers to your frequently asked questions about home equity lines of credit (HELOC).

How to Save Money: Home Equity Tax Deductions

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Whether you use a home equity loan to pay your child’s college tuition or a home equity line of credit to continue upgrading your home to the house of your dreams, home equity has many advantages. And one of those benefits comes from tax deductions.

Is Interest on a Home Equity Loan Tax Deductible?

Yes, under the Tax Cuts and Jobs Act of 2017, interest paid on a home equity loan to further improve, upgrade, or add on to the home is tax deductible. However, if the loan pays for personal living expenses such as tuition or credit card payments, the interest paid is not tax deductible. Below, we explore additional home improvement projects that can provide tax deductions.

Home equity lines of credit: In addition to home equity loan interest, home equity lines of credit are also tax deductible. All qualifying expenses are tax deductible whether your home equity covers a loan, line of credit, or second mortgage.

Upgrades for medical purposes: Certain home improvements for medical purposes can be tax deductible, such as widening doorways, adding a ramp to an entryway, and lowering cabinets and counters. These expenses must exceed 7.5% of your adjusted gross income and cannot add any value to the home.

Energy efficiency improvements: The world is becoming greener! Now, you can write off certain energy efficiency investments. This is called the residential energy efficient property credit. If you add solar, geothermal, or other green energy sources to your home, you may qualify for a tax deduction!

You work hard to increase the value of your home. Understanding your deductions on home equity loan interest can be challenging. See your tax advisor for assistance.

Call us today at 888-873-2640 for more information on Home Equity loans.

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