Home Equity Loans

Home Equity Line of Credits (HELOCs) operate on a monthly billing cycle, similar to a credit card. The minimum payment is calculated at the beginning of each cycle, and that payment is due before the next cycle begins. 

 For example, let’s say your billing period is from June 3 to July 2. The payment is cycled at end of business on July 2, with the payment due by end of business on August 1 (the next cycle is July 3 to August 2). If the payment due on August 1 is not paid before the cycle on August 2, the billing notice will show two payments due with one of them past due. This assumes no partial payments were made. 

There are multiple ways to find out your payment amount and due date. You will receive a loan billing notice every month stating the minimum payment amount and when it is due. This will be mailed to you unless you are enrolled in eDocuments. Billing notices can be received electronically if the member has opted in for electronic statements/notices. The amount due and next due date can also be verified by viewing your account online through Digital Banking or contact us. 

When applying for a Home Equity Loan, please provide the following: 

• Proof of income (pay stubs for the last 30 days, 2 years W2 or 1040s) 

• Proof of Homeowner's Insurance (policy declaration page) 

• If you have a first mortgage, your most recent statement 

• A copy of your tax bill 

Additional information may be required. 

A home equity loan is a term loan in which the borrower gets a one-time lump sum. The loan is repaid over a fixed term, at a fixed interest rate, with equal monthly payments. 

A HELOC works more like a credit card. You’re given a line of credit that’s available for a set time frame, usually up to 10 years. This is called the draw period — during this time, you can withdraw money as you need it. 

HELOCs can fall under two scenarios: 

One with an interest-only draw period (applies when LTV is up to 80%) 

One with a draw period where you  pay interest and principal (applies when LTV is 80.01% to 90%) 

As you pay off the principal, your credit revolves and you can use it again. When a line of credit has expired, you enter the repayment period, which can last up to 20 years depending on your loan-to-value ratio (LTV). You’ll pay back the outstanding balance that you borrowed, as well as any interest owed. If you have questions on LTV or the scenario that your line of credit may fall under, please contact us. 

A HELOC has a variable interest rate that is tied to the Prime Rate as published in the Wall Street Journal. As the prime rate moves up or down, so does your HELOC rate. Payments will vary depending on the interest rate and your outstanding balance.