Spring comes with a sense of renewal and rejuvenation – and your home should be no different! Spring is the perfect time to get a head start on remodeling your deck, sprucing up the garden, or completing routine maintenance on your roof and windows to keep your biggest investment in tip-top shape. Whether you’re simply keeping your house in working order with various updates and repairs, or overhauling and replacing an HVAC unit or other large household fixtures, a Home Equity Line of Credit (HELOC) could provide some relief.
What is a HELOC?
A Home Equity Line of Credit is a line of revolving credit similar to a credit card, but this form of credit uses your home as collateral. Home Equity Lines of Credit are loans set up as a line of credit in which funds can be drawn when the borrower needs the money, rather than in a lump sum. Funds in a Home Equity Line of Credit can be accessed at any time, however, cannot exceed the amount originally set from the beginning. Because a HELOC is a revolving credit line, funds can be spent on anything; the only role your home plays related to a HELOC is to serve as collateral against default.
Benefits of and uses for a HELOC
The flexibility of a Home Equity Line of Credit is one of its biggest benefits. Tapping into your home’s equity at any time for whatever purpose you choose is a huge advantage. As brighter skies, longer days, and warmer temperatures come around, consider your spring cleaning list. While using the money to fund a vacation to shake the winter blues may sound great, a HELOC can be used to plan a backyard makeover, cover much-needed repairs, or take care of any other spring project.
Tax advantages are another added benefit of using your Home Equity Line of Credit to make those various home improvements. In many cases, interest paid on home equity loans can be deducted. When used for home improvements and repairs, interest paid on a Home Equity Line of Credit is typically deductible; interest paid on the loan when used to pay off personal living expenses (like paying down credit card debt) is not. As always, please consult your tax professional. A tax professional can adequately evaluate your situation and keep you up-to-date with any legislative changes
A Home Equity Line of Credit from First Bank allows you the freedom to use the equity in your home to finance major expenses like a master suite addition to a garage door replacement and all jobs in between. Winter may have wreaked havoc on your home, but a HELOC can put a spring in your step and help fund this spring’s to-do list. The best home improvement is the kind your house pays for. Let’s get to work. See how a First Bank HELOC can help – get more information and apply by going to a First Bank branch.
Source: IRS.gov, Internal Revenue Service