Home Equity Line of Credit
Definition
- An open-ended loan, paid as revolving debt, that is backed by the equity in a property or home.
Notes
Also known as a Home Line of Credit.
Synonyms
trust, loan, borrow, debt
Acronyms
HELOC
Related Terms and Acronyms
- Credit — Definition,
- Money that a lender gives to a borrower on condition of repayment over a certain period.
- Debt Consolidation — Definition,
- The replacement of multiple loans with a single loan, often with a lower monthly payment and a longer repayment period. It's also called a consolidation loan. CanEquity has access to Canada's best debt consolidation products, for more info about debt consolidation see our debt consolidation page.
- Equity — Definition,
- Ownership in an asset.
- The value of a property minus outstanding mortgage debt and other liens.
- Home Equity (HE) — Acronym, Very Important,
- The part of a home's value that the mortgage borrower owns outright; the difference between the fair market value of the home and the principal balances of all mortgage loans.
- Home Equity Debt — Definition,
- Debt secured by your home.
- Interest Only Payments — Definition,
- A payment plan where only the interest is paid off.
- Lien — Definition,
- A legal hold or claim of a creditor on the property of another.
- Line of Credit (LOC) — Acronym,
- A commitment by a financial institution to lend up to a specified maximum amount to a customer during a specified period of time.
- Personal Loan — Definition,
- A loan made for personal, family, or household use as opposed to a business-type loan or a long-term mortgage loan to finance real estate.
- Refinance — Definition,
- To arrange a new loan for an increased amount or better terms whereby the old loan is paid off from the proceeds of the new loan.
- Refinancing — Definition,
- The act of paying off one mortgage with another mortgage to take advantage of lower interest rates. Refinancing is also used to transform equity into cash for vacations, home improvements, or for consolidating debt.
- Repayment Period — Definition,
- In a home equity line of credit, that portion of the life of the loan that follows the draw period. During the repayment period, the borrower cannot take out any more money, but must pay down the loan.
- Revolver — Definition,
- A term credit card issuers use for card holders who roll over part of the bill to the next month, instead of paying off the balance in full each month. About seven out of 10 cardholders revolve the debt.
- Revolving Line of Credit (RLOC) — Acronym,
- An agreement to lend a specific amount to a borrower, and to allow that amount to be borrowed again once it has been repaid. Most credit cards offer revolving credit.
- Secured Debt — Definition,
- A debt that is secured by a lien on debtor's property that may be taken by the creditor in case of non-payment by the debtor. A common example is a mortgage loan.
