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TERMINOLOGY
A home equity line of credit is a very flexible lending option. If you need cash for any reason, a HELOC can give you the ease of borrowing as you go when you need the funds. As long as you have equity in your home, this could be a good option for you.
1. Home Improvements
Home improvements are a very common reason to use a HELOC. You are essentially taking equity from your home but also adding value to your home with certain upgrades. You may be adding to the size of the home or upgrading the kitchen and bath. You may need to make structural repairs, like a new roof or electrical wiring, to keep your home safe.
2. Debt Consolidation
A HELOC is often used to consolidate debt. If you have credit cards with high interest rates, a HELOC could save you a lot of money every month. HELOCs are tax deductible also.
3. College
A HELOC also could be a good way to pay for college. Instead of taking out student loans at a higher interest rate, you could use a HELOC. This would make those loans tax deductible on your income taxes. You will also have the flexibility to borrow over the years as needed.
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