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What is a HELOC and How Can I Use It?

By Azura Credit Union

Have you ever heard of a HELOC? HELOC stands for Home Equity Line of Credit. A HELOC is a valuable tool many home owners use to make the equity in their home work for them!

HELOC's typically have lower interest rates than unsecured loans and credit cards, and the line of credit is there when you need it. If you've ever wondered what you could do with a HELOC, read on for a few popular ideas.

Learn more about Azura's HELOC options today.

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Most people who take out a HELOC do so to make home improvements. Experts say you should only do this if the improvements you’re considering will increase your home’s value. This way, the money you’re borrowing will be returned when you sell your house at a higher price.

The National Association of Realtors’ 2015 Remodeling Impact Report lists these six changes as the ones with the best return on investment:

  • Installing a new front door.
  • Installing new siding.
  • Upgrading your kitchen.
  • Adding on to your deck and patio.
  • Making an attic into a bedroom.
  • Installing a new garage door.

These improvements can range from a few hundred to tens of thousands of dollars, but they don’t change the footprint of your home and tend to be what future buyers look for.


Everyone should have an emergency fund to cover events such as unexpected car repairs and appliance breakdowns. Most people keep these in savings accounts, but you might consider a home equity line of credit as another source of emergency funds. You only pay interest on the amount you borrow, and you could pay the loan off quickly to save money. 


Because the average interest rate on a HELOC can be lower than the average credit card interest rate, many people think about using a HELOC to pay off their credit card debt. This is a great strategy if you’re committed to paying down high interest debt. 


These are just a few ideas on how you can use a HELOC to work for you! It is always a great idea to speak with a home equity professional to help make the best decision. At Azura, our Home Loan team is happy to help! To learn more about Azura's HELOC options, click here or give us a call at (785)233-5556.



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Tags: Mortgage