Is a Heloc Right for You

Is a HELOC Right for You?

A home equity line of credit (HELOC) may be a good option if you’re looking to consolidate debt, renovate your home, or make a large purchase.

How does a HELOC work? 

A home equity line of credit is different than most loans. 

  1. Source funds using the equity in your home 
  2. Get approved for an amount
  3. Use as a line of credit (for home repair, large purchase, debt consolidation, etc.)
  4. Take as little or as much as you need, up to your limit
  5. Opt to take a fixed-rate advance (3 fixed-rate advances can be open at once)
  6. Withdraw for 10 years
  7. Repay for another 15 years

Pay no origination fees with BECU.* 

If you already have a HELOC, switching is effortless.  If you have a HELOC at another institution, it's a great time to consider refinancing with BECU. You'll pay no origination fees, no appraisal fees, no closing fees, and no pre-payment penalties, title insurance fees, document mailing fees, escrow fees. Plus, you'll enjoy some seriously low rates.

Looking to consolidate debt, make a large purchase or do major home repair?

  A HELOC is tied to your home's equity, and can offer you a large sum of money at a lower interest rate, giving you the flexible terms when you need it.
Use your equity to your advantage   Today's homeowners may find themselves with unused equity in their home. The value in a home can sometimes translate into lower borrowing rates when used to secure a HELOC. These lower borrowing rates are a great option for any loan, especially if you're taking out a HELOC to consolidate higher interest–rate debt. 

You can lock in your rate

Have a larger project or set amount of funds you want to take? You can “fix” the interest rate on it, locking in the rate. This is done once you've set up a HELOC. Having a static rate on a large sum offers peace of mind on the interest rate you pay in the long term. 

Let's say you want to use $25,000 to consolidate debt and to upgrade your bathroom. Instead of drawing the money from your home equity and then repaying the funds back at varying rates, you can request a fixed-rate advance.

Up to three fixed-rate advances (of $5,000 or more) can be open at the same time, and choosing this option sets both a fixed payment amount and a rate that won't change even if the prime rate adjusts – HELOC rates could go up the very next day, but the interest on your fixed-rate advance remains unchanged! 

You have a 10-year draw period, and a 15-year repayment period.

You can withdraw funds at any time and in any amount (up to limit of your line of credit) during the draw period. You can choose to make payments on just the loan's interest during the 10-year draw period (with a minimum payment of at least $100), rather than paying on both principal and interest. However, homeowners who make payments toward the principal throughout their draw period find that they owe much less by the time the 10-year draw period ends, and their 15-year repayment period begins.

Take advantage of a BECU HELOC and get: 

  • Low APRs on fixed- and variable-rate options
  • Protection from rising rates with our fixed-rate option*. Up to three fixed-rates advances can be active at once. 
  • No origination fees, which means no application, no appraisal, and no closing fees
  • No pre-payment penalties
  • Consolidate high interest–rate debt at a lower rate
  • Funds whenever you need, up to your available credit limit – simply transfer funds to your checking account

Get started  

If you're a homeowner interested in opening a HELOC, we're here to help. Explore your options by calling 800-233-2328, or visiting any BECU location. You can make an appointment with a member consultant, and have all your questions answered in person.

*The rate for the Home Equity Line of Credit (HELOC) is based on the highest Prime Rate as published in the Wall Street Journal as of the date of any rate adjustment plus a margin. Rates currently range from 5.49% to 10.99%  as of 3/1/2019. The actual rate may be higher than the advertised rate for loans exceeding 70% combined-loan-to-value (CLTV), non-primary residencey, or if you have lesser creditworthiness. Not every applicant will qualify . APRs do not include costs and rate may vary monthly (maximum 18% APR).During the credit advance draw period, payments equal monthly payments of interest, subject to lesser of $100 or your balance and principal is not reduced. At the end of the draw period, your monthly payment will increase equal to the principal and interest amount necessary to pay the loan balance over the remainder of the loan term amortized over 180 months. APR for a Fixed Rate Advance (FRA) as of 3/1/2019 ranges from as low as 5.49% to 10.99 % and is determined at the time the FRA is established. FRAs provide for up to 15 years of fixed monthly principal and interest payments, depending on the amount advanced. FRAs are subaccounts of a HELOC. Primary residence and Second Home/Vacation Home property must be located in one of the following states: WA, OR, CA, AZ, KS, MO, IL, PA, ID and SC. Rental/Investment property must be located in the State of Washington. In normal circumstances, you will not have to pay any fees in order to open a HELOC, but insurance to protect the property against hazards (including flood insurance, if applicable) is required. Borrower is also required to pay for optional services (e.g. if borrower retains an attorney that borrower is not required to use). In South Carolina, where the law requires use of an attorney, BECU will be solely responsible for paying all attorneys fees and costs necessary to open the HELOC, and will perform this responsibility fully by paying all reasonable attorneys fees and costs related specifically to the closing based on rates typically charged by attorneys in the local market for the closing of similar HELOC transactions. Additional state or local mortgage fees or taxes may apply. An Automated Value Model (AVM) may be obtained in lieu of an appraisal at no cost to member. All loan programs are subject to change without notice. Loans are subject to credit approval and other underwriting. Reconveyance fee applies when refinancing or paying off a BECU Home Equity Line of Credit or BECU Home Equity Loan.