HELOC

Definition

A HELOC (home equity line of credit) is a revolving line of credit secured by the equity in your home. It works similarly to a credit card: you can borrow up to your credit limit, repay, and borrow again during the draw period, which typically lasts 5 to 10 years. HELOCs usually have variable interest rates, and the interest may be tax-deductible if the funds are used for home improvements.