Home Equity Line of Credit
Leveraging your largest asset.
A Home Equity Line of Credit2 lets you tap into your home equity as needed. You can pay down and re-borrow against it as you see fit. A line of credit is especially helpful to borrowers who have several upcoming home improvements or phased projects or want a safeguard to fund large, unexpected, or ongoing expenses like school tuition. You can reduce interest costs by paying down the balance between draws.
Like any other equity loan, HELOCs require that you have enough available equity to get the loan you want. But because they are revolving lines of credit (similar to a credit card), HELOCs are really best for borrowers who are comfortable with variable interest rates and payments and who want the flexibility to make interest-only payments for a time. CUTX recommends borrowing only what is needed, rather than maxing out the limit and carrying debt.
Your estimated interest-only payment during your draw period is $XXX.
During your repayment period, your payment will be $XXX.
Your estimated interest-only payment during your draw period is $XXX.
During your repayment period, your payment will be $XXX.
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A HELOC is perfect for financing large and small home improvement projects, especially if the projects are happening in phases. Unlike home improvement store loans and credit cards, a CUTX HELOC comes with a low interest rate that can save you thousands in interest over the life of the loan compared to a credit card.
Using a HELOC to pay for larger costs such as college tuition and educational expenses is a great way to avoid the need for private or federal student loans. The flexibility of a HELOC lets you borrow what you need, pay down the balance, then re-borrow funds again the following semester. And you only pay interest on what you borrow.
Having a swimming pool built in your backyard can come with hidden and unexpected costs, especially when it comes to landscaping and finishing touches. That's what makes a HELOC a popular financing option for homeowners who are building a swimming pool. You can borrow what you need, then borrow more.
If you're interested in HELOCs and using your home equity to invest in things like home renovations, your or a loved one's education, or other expenses, enroll in CUTX's Home Equity Email Series today.
Use the calculator above to see how much of a home equity loan you can potentially qualify for, then click the Get Started button to work with a CUTX specialist and complete an application.
Your loan specialist will work with you every step of the way to help gather the necessary documents for approval.
All signatories must be present to sign documents at closing. Bring valid photo identification. Once the closing has taken place, a required 3-day waiting period begins in which the borrower can still cancel the loan if they so choose.
After the required waiting period passes without cancellation, CUTX will make your Home Equity Line of Credit available to you so you can make your first draw.
CUTX Home Equity Lines of credit have lower interest rates than other types of revolving credit, such as credit cards. They allow you to borrow from your home’s equity and repay only the interest for a period of years, if you choose. Or you can pay the loan down between draws. If you use the HELOC to pay for home improvements your interest payments may be tax deductible—discuss with your tax advisor.
And CUTX charges no prepayment penalties.
Texas law limits home equity loans and lines of credit to 80% loan-to-value (LTV). This is a measure of how much you owe compared to the value of the home. At CUTX, the minimum loan amount is $25,000 and the maximum is $750,000 for first liens and up to $300,000 on second liens. Use CUTX’s Available Equity Calculator to get an idea how much you might be able to borrow.
CUTX charges no closing costs for home equity loans under $200,000.
The home must be in Texas, not zoned agricultural and be single family, owner-occupied. That includes houses, condos, townhomes or duplexes. CUTX does not do home equity loans or mortgages for mobile homes or manufactured homes. Borrowers can only have one Home Equity Loan or HELOC at a time.
Some borrowers feel that the variable interest rates on HELOCs are a disadvantage because the price of the debt may increase if interest rates rise. Therefore HELOCs are best for people who have the ability to pay down the balance regularly as needed.
The risk with home equity lines of credit is that borrowers could find themselves maxed out on their line of credit and in financial trouble. This could endanger your home ownership. Another issue is that interest rates on HELOCs are flexible, so the price of the debt may increase if interest rates rise. HELOCs are best for people who have the discipline to pay them down regularly.
1 - Credit Union of Texas offers a variable Annual Percentage Rate (APR) based on the Prime Rate as published in the Money Rates section of The Wall Street Journal (the “Index”) plus a margin. As of December 20, 2018, the Index value is 5.50% and the margin rate is 0.20%. The floor APR will be 3.00%. An increase in the Index will result in an increase in the periodic rate which, in turn, will result in higher payments. In no event, will the APR increase by more than 18% or the maximum rate allowed by applicable law. Offer is limited to consumer HELOCs and Home Equity Loans not currently held at Credit Union of Texas. First payment date is 30 days after closing. Property insurance is required, including flood insurance where applicable. The minimum advance during the draw period is $4,000. No closing costs. If, however, an appraisal or a policy of title insurance is required, applicant is responsible for those costs. Texas homestead properties are limited to 80% combined loan to fair market value for home equity financing. All loans are subject to credit approval and Credit Union of Texas lending policies. Other restrictions may apply. In Texas, there is a 12-day cooling off period on all HELOCs. Actual time of funding may differ depending on appraisal, title and other underwriting requirements. This is a limited-time offer and is subject to change at any time without notice. The account is subject to application, credit qualification, and income verification; additional evaluation and verification criteria may apply. Your actual APR will depend upon your credit transaction and credit history and will be determined when a credit decision is made. CUTX home loan programs are only available in Texas. Membership in CUTX is required. Equal Housing Opportunity.
2 - NMLS #576560 Credit Union of Texas provides home equity loans and home equity lines of credit through its affiliate Texas Mortgage Lending, LLC, NMLS #1641703. Texas homestead properties are limited to 80% combined loan to fair market value for home equity financing. All loans are subject to credit approval and Credit Union of Texas lending policies. Other restrictions may apply. CUTX home loan programs are only available in Texas. Membership in CUTX is required. Equal Housing Opportunity.
