Home Equity Line of Credit (HELOC)
A HELOC uses your home as collateral for a line of credit that you can access as needed. There are 2 types of HELOCs, a HELOC with a principal and interest draw period or a HELOC with an interest-only draw period. The latter option has asset eligibility requirements. With both options, you'll be approved for a specific line amount to draw from multiple times, up to your available credit limit.
The HELOC includes 2 phases:
- The draw period, when you can access your funds
- The repayment period, when you repay the outstanding balance at the end of your draw period
Because a HELOC is flexible and usually has a higher limit, it's generally used to pay for large items like tuition or home improvements rather than day-to-day expenses. Some homeowners also use a HELOC to consolidate higher-interest-rate debt.
A HELOC may be the right choice if you:
- Have built up equity in your home
- Prefer to withdraw money as you need it
- Want to borrow between $10,000 and $1,000,000
Fixed Rate Home Equity Loan
A Fixed Rate Home Equity Loan provides a set amount of money that you repay in equal monthly principal and interest (P&I) payments over a fixed time period.
If you have a balance on your existing mortgage, Citi offers Fixed Rate Home Equity Loans with 5, 10, 15, 20, 25, and 30-year terms.
This loan could be a good fit if you prefer consistent monthly payments for a longer amount of time, or if you need a certain amount for a specific purpose like paying for tuition or home renovations.
A Fixed Rate Home Equity Loan may be the right choice if you:
- Have a balance on your existing mortgage
- Prefer to have set monthly payments over a set term
- Have a large, one-time borrowing need
- Want to borrow between $25,000 and $300,000