HELOAN

Often identified as a “home equity loan,” a HELOAN is a loan based on the equity a homeowner has in his or her home. (See also equity.) Once the equity is determined and the funds are available, the lender will disburse the funds in one lump sum. Repayment subsequently begins, usually with a fixed interest rate and set monthly payments (which will not change). HELOANs are ideal for large, one-time expenses such as consolidating debt or large home renovation projects.