What the heck is a HELOC?

by Chris Gottschalk, First Alliance Credit Union

In the past, we’ve talked about financial concepts that might be a bit tricky to understand, like a personal loan or an escrow account. With both of those accounts, though, you at least had some idea of what they were—one was a loan and one was an account.

A HELOC, on the other hand, gives you no clue what it’s about. It’s obviously an acronym, but what does it stand for? High Explosive Legal Obligations Contract, or Hey Everyone, Let’s Open Champagne?

Actually, a HELOC is a very useful financial tool that, if you use it right, can help you reach some major financial goals. Hey Everyone, Let’s Onboard Credit knowledge!

Okay, what is a HELOC?

What does HELOC mean?

HELOC stands for Home Equity Line of Credit. In other words, you’re opening a line of credit, and the limit on your account is how much equity your home has available.

 

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