Everything you need to know before taking out a home equity line of credit

This article is reprinted by permission from NextAvenue.org.

Since home buying has sputtered, banks are feverishly pushing home equity lines of credit (or HELOCs) to homeowners whose properties have regained much of the value they lost during the housing bust.

“Lenders are opening up their spigots,” Sam Khater, deputy chief economist at CoreLogic, a mortgage-data firm, told The Wall Street Journal. Should you bite?

“Home equity borrowing is regaining appeal in an environment of increasing home values and continued low interest rates,” says Greg McBride, Bankrate.com‘s chief financial analyst. “For savvy borrowers, this can be a low cost source of funds for home improvement projects or other needs.

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