As HELOCs Return, Here’s How and Why to Use One

People are borrowing from their homes’ equity the way they used to — and that’s a good thing.

We’re talking about home equity lines of credit, or HELOCs. They soared in popularity in the early 2000s, then faded after 2008. In recent years, HELOCs were eclipsed by cash-out refinancing, another method of getting one’s hands on equity.

Now, HELOCs are tiptoeing back. The number of HELOCs inched up in the second half of last year. The amount borrowed from HELOCs nosed upward, too: In the fourth quarter of 2022, homeowners owed $336 billion on their HELOC balances, up from $318 billion a year earlier.

As HELOCs revive from a lengthy dormant period, a new generation of homeowners is unfamiliar with them and may need some schooling.

What HELOCs are good for

Don’t be alarmed by the return of HELOCs. Yes, they sunsetted around the time that subprime mortgages went kablooey. But HELOCs aren’t subprime loans, and they’re useful for various purposes.

A HELOC is a second mortgage that lets you keep…

Continue Reading →

This article was written by Holden Lewis and originally published on