If you need cash to remodel your kitchen or bath, a Home Equity Line of Credit (HELOC) might be your best bet.
This loan lets you borrow money using the equity in your home as collateral. Equity is the difference between what you owe on your home and its appraised fair market value.
Unlike almost any other consumer loan type, the interest on a HELOC of $100,000 or less is likely to be tax-deductible ($50,000 if married filing separately).
A HELOC is much like a credit card or any other type of open-ended credit. You can borrow money as needed, up to the credit limit your lender assigns, by making a transfer into your checking account. A HELOC is usually a variable-rate loan, so your monthly payments will change based on your outstanding balance and fluctuations in the prime rate.
Plus, the Feds lowered rates a few months ago, so now makes a GREAT time for a HELOC.
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