Why To Consider a Home Equity Line of Credit (HELOC) This Summer

When it comes to home renovations, timing is everything. Taking advantage of warm weather for your projects can save you a lot of hassle. And one of the best ways to finance these improvements is through a HELOC, or home equity line of credit.

This flexible financing option is particularly advantageous when planning renovations during favorable weather conditions, which means you don’t have to deal with the inconvenience of winter repairs.

Keep reading to learn more about what a HELOC is, how it works, and why it’s a good idea to undertake renovations while the weather is warm.

What is a HELOC?

A home equity line of credit, or HELOC, is a type of loan that allows homeowners to borrow against the equity in their home. Equity is the difference between your home’s current market value and the amount you owe on your mortgage. A HELOC provides a revolving line of credit that you can draw from as needed. It’s kind of similar to a credit card, but HELOCS typically have much lower interest rates.

HELOCs are especially useful for financing home renovations, as they offer flexibility in borrowing and repayment. You can borrow funds as needed for different stages of your project, making it easier to manage expenses and avoid taking out a lump sum loan that might be more than you need.

How Does a HELOC Work?

A home equity line of credit operates in two phases: the draw period and the repayment period.

During the draw period, which typically lasts 5 to 10 years, you can borrow money as needed up to your credit limit. You only pay interest on the amount you borrow. This period is ideal for completing home renovations because you can access funds incrementally as your project progresses.

After the draw period ends, the repayment period begins. This phase typically lasts 10 to 20 years, and this is when you must repay both the principal and interest. Repayment terms can vary, but many HELOCs offer flexible payment options to help you manage your finances effectively.

When Is the Best Time for a HELOC?

If you’re considering a HELOC for home renovations, summer could be the perfect time to apply.

Warm weather provides optimal conditions for construction and renovation work. Materials like paint, concrete, and adhesives cure more effectively in warm temperatures, leading to higher quality results. And longer daylight hours allow for more work to be completed each day, accelerating the renovation process.

Using a HELOC for home renovations while the weather is warm also ensures that any immediate repairs or improvements are completed before colder weather moves in. This is particularly important for essential updates like roof repairs, window replacements, and insulation improvements, which can prevent cold drafts, water damage, and increased heating costs during the colder months.

Then, once all your renovations are done, you can hole up in your freshly renovated home – warm, cozy, and dry – regardless of what the weather outside is doing.

What Are the Main Benefits of HELOCs?

There are so many benefits of HELOCs, but one major advantage is that you are not restricted to using the funds solely for home renovations. Whether you need to fund higher education, create a financial safety net, or manage any other substantial expense, a HELOC offers the flexibility to access the money when you need it.

And Academy Bank provides HELOCs with interest rates that are typically lower than most credit cards, making it a cost-effective option for significant financial needs.

With a home equity line of credit from Academy Bank, you can enjoy a range of benefits:

• Fixed Introductory Rate Special for 6 Months: Start with a fixed, lower interest rate for the initial six months, giving you time to plan your finances.
• Borrow Up to 85% of Your Home's Value: Depending on your circumstances, you can borrow a substantial portion of your home's equity.
• Low Minimum Monthly Payments: Manage your cash flow with minimal monthly payments.
• Annual Fee Waived with Auto-Draft Payments: Save on annual fees by setting up automatic payments.
• Low or No Closing Costs: Reduce the upfront costs of setting up your HELOC.
• Lower Interest Rate Than Most Credit Cards: Benefit from lower interest rates compared to credit cards, making it a more affordable borrowing option.
• Easy Access to Your Funds: Conveniently access your funds as needed.

Apply for Your HELOC with Academy Bank Today

A HELOC from Academy Bank provides a practical and advantageous way to finance large home projects and other significant expenses. With flexible terms, lower interest rates, and easy access to funds, a HELOC ensures that you can manage your financial needs effectively while enhancing the value and comfort of your home.

Ready to get started before colder weather moves in? Apply for a HELOC today!

And if you want to learn how to calculate a home equity line of credit and other financial metrics, we’ve got you covered. Explore our different financial tools, including: HELOC Calculator, Line of Credit Payoff Calculator, Loan & Line of Credit Payment Calculator, Debt Consolidation Calculator, Loan & Credit Line Tax Calculator, and more!

 

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