HELOC - Home Equity Line of Credit

HELOC is the acronym for Home Equity Line Of Credit. This differs from a home equity loan in that a HELOC is like a line of credit where you continue to write checks on the equity of your home rather than on actual money in the bank. A HELOC is similar to a credit card in that there is no set period in which you have to pay off since you can continue to borrow against it. For this reason, it is better to refinance debt with a home equity loan rather than with a line of credit. Whenever you find yourself in need of a sum of money to fund a new car, renovate your home or consolidate debt, a home equity loan can be a smart financial tool.