Which Home Equity Option Makes Sense for You?
There is more than one way to access your home equity without refinancing your first mortgage. And the differences can matter.
The right strategy depends on:
How you plan to use the funds
How much you need and when you need it
How you want your payments structured
Your age, income, property, and qualification profile
Your longer term financial goals
We'll help you understand the tradeoffs and determine which strategy best fits your situation.
You don't need to know which loan you want. That's what we're here to help you figure out.
Four Ways to Access Your Equity
Each option works differently. The best fit depends on what you're trying to accomplish and how you want to access the funds.
HELOC
Flexible Access when you need it
✓ Draw funds as needed
✓ Pay interest only on what you've borrowed
✓ Reuse available credit as you pay it back
✓ Typically has a variable interest rate
Often worth considering when:
Your expenses will occur over time or you want ongoing access to available equity.
Renovation HELOC
Use the value you're creating
✓ Designed for home improvement projects
✓ May consider the home's expected value after renovations
✓ Can potentially unlock more equity than today's value alone
✓ Keep your existing first mortgage in place
Often worth considering when:
You're planning a significant renovation that is expected to increase your home's value.
Fixed Second Mortgage
Predictability from the start
✓ Receive funds in a lump sum
✓ Fixed interest rate
✓ Predictable monthly payments
✓ Keep your existing first mortgage in place
Often worth considering when:
You know approximately how much you need and value predictable payments.
Reverse Mortgage Second
Access equity without a new monthly mortgage payment
✓ Keep your existing first mortgage in place
✓ No required payments on the new loan
✓ Designed for eligible older homeowners
✓ Provides another way to access accumulated home equity
Often worth considering when:
You're eligible and want to access equity while minimizing the impact on monthly cash flow.
These aren't simply different versions of the same loan. Each can solve a different problem.
The Right Option Depends on How You’ll Use It
The amount you need is only part of the decision. How and when you plan to use the money can be just as important.
Need Money Over Time?
A HELOC may provide flexibility when expenses happen gradually or you want access to funds as needs arise.
Need a Specific Amount Now?
A fixed second may make more sense when you know how much you need and prefer predictable payments.
Planning a Major Renovation?
Renovation financing may allow the value you're creating through the improvements to become part of the financing strategy.
Want to Preserve Monthly Cash Flow?
For eligible older homeowners, a reverse mortgage second may provide access to equity without adding a required monthly payment on the new loan.
The question isn't simply which loan has the best terms. It's which structure best fits what you're trying to accomplish.
The Right Option Also Depends on How You Qualify
Not every home equity option uses the same qualification guidelines. Your income, credit, property type, available equity, and overall financial picture can all influence which strategies are available.
Traditional Qualification
For many homeowners, standard income, credit, and equity guidelines provide a straightforward path.
More Flexible Approaches
Self employed, significant write offs, variable income, or an investment property? Other qualification methods may provide additional options.
Different Products, Different Guidelines
Not qualifying for one type of home equity financing doesn't necessarily mean you've run out of options. Another structure may evaluate your situation differently.
Our job is to look beyond a single loan program and find the options that fit your complete financial picture.
Not Sure Which Option Fits? You Don’t Have to Be.
Choosing the right way to access your equity can involve more than comparing rates or loan features. We’ll look at your goals, your current mortgage, your financial situation, and the options available to help you build the right strategy.
The right loan starts with the right strategy.