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[BUSINESS] · United States · 5 sources

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Home equity options: Comparing loans and HELOCs

U.S. homeowners currently hold more than $11.5 trillion in tappable home equity, averaging approximately $212,000 per homeowner. This equity is determined by subtracting the remaining mortgage balance from the total home value.

Homeowners can access this value through two primary methods: home equity loans and Home Equity Lines of Credit (HELOCs). A home equity loan provides a lump sum of capital with a fixed interest rate and predictable payments, making it suitable for one-time expenses. In contrast, a HELOC offers flexible access to funds with a variable interest rate, which is better suited for ongoing or uncertain costs. In both scenarios, the home serves as collateral for the borrowed funds.

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Members 1st Federal Credit Union

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