How Long Are HELOC Loans?
HELOC loans vary from 5 to 30 years, with a 5-10 year draw period for borrowing and a subsequent 10-20 year repayment period. Specific terms depend on the lender and borrower agreement.
by Sai V
Published Oct 26, 2023 | Updated Oct 26, 2023 | ๐ 1 min read
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How Long Are HELOC Loans?
HELOC loans, or Home Equity Lines of Credit, typically have terms ranging from five to 30 years, similar to home equity loans. The specific duration of a HELOC loan depends on the lender and the agreement between the borrower and the financial institution.
During the draw period, which usually lasts 5-10 years, borrowers can use funds and make interest-only payments. Afterward, there's a repayment period where the remaining balance is paid back over a set period, commonly between 10 to 20 years. HELOC terms can vary, so it's crucial for borrowers to understand the terms and repayment schedules outlined in their specific agreement.
What Is A HELOC Loan?
A Home Equity Line of Credit (HELOC) is a flexible second mortgage allowing homeowners to access their home equity as needed, similar to a credit card. It operates on a credit limit basis, enabling multiple withdrawals and repayments during a specific draw period. Unlike a regular loan, it uses the home as collateral, making responsible usage crucial to avoid the risk of foreclosure.
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