It’s no wonder home ownership is such a desirable attainment in the U.S. – there are too many benefits to owning your own home as opposed to leasing your primary residence from a landlord. For instance, tenants continuously pay rent, month after month, without ever seeing that money again. On the flip side, home ownership allows you to build equity – the value of what you truly own – over time, until you either sell the property (hopefully for a higher price than what you initially paid) or pay off your mortgage loan and own the property outright.
Another advantage to home ownership is that you can borrow against this build-up of equity if/when you need additional cash for anything ranging from debt repayments to vacation savings or home renovations. You can borrow from your home’s equity through a home equity line of credit (HELOC) or a home equity loan to pay for these expenses without having to dip into your own savings, put everything on a credit card or take out a high-interest personal loan.
If you’re a homeowner with a large expense coming in your future – or a considerable amount of debt to tackle right now – then a HELOC might be a great option for you. There are plenty of companies offering HELOCs and home equity loans, but Figure stands out from the competition when it comes to expedient, transparent and simple HELOC borrowing practices.
What is a Home Equity Line of Credit?
First things first: what is a home equity line of credit? In a nutshell, HELOCs use the equity in your home (the difference between your home’s current value and your remaining mortgage balance) as collateral for the money you’d like to borrow.
HELOCs are different from home equity loans in that they function similarly to credit cards, allowing you to withdraw funds through bank transfers, writing a check to yourself, or even using a special credit card that’s synced to your account. Meanwhile, home equity loans are doled out as lump sum of cash with fixed rates, loan processing fees, appraisal fees, and other fees as determined by your lender (HELOCs typically have far fewer fees by comparison).
Why Take Out a Figure HELOC?
HELOCs are useful for ongoing expenses, whereas a home equity line of credit is best reserved for large, one-time expenses (such as a wedding, major home renovation, etc.). HELOCs can also be useful for a one-time expense due to their lower fees and greater flexibility for borrowers.
Functionally, HELOCs are ideal as an emergency source of relatively accessible cash; however, it’s worth noting that the ease of access with HELOCs can lead some borrowers to take out more money than they actually need, so be mindful of only taking out a home equity line of credit if you genuinely need one.
Other reasons why you might take out a Figure HELOC include:
- Home repairs and renovations
- Pay off personal debts (credit cards, personal loans, auto loans, medical debt etc.)
- Fund a college education
- Invest in the stock market (risky – but people certainly do this)
Why Take Out a HELOC with Figure?
Figure is one of many financial institutions offering home equity lines of credit to qualified borrowers – but why would you choose Figure over other options out there? One reason includes Figure’s reliance on blockchain, AI and advanced data analytics to simultaneously expedite and simplify the HELOC process for homeowners seeking cash to pay off debts, fund home renovation projects or cover other expenses.
Figure is well-known for its transparency and data security mechanisms, which improve the consumer experience without the usual hassle many other people go through when applying for HELOCs. You can borrow as much as $150,000 through a HELOC (subject to credit approval) and there are flexible loan terms ranging from 5 to 30 years.
Unlike other companies offering HELOCs, Figure does not charge account opening fees or account maintenance fees or even prepayment fees; you’ll just pay an origination fee and a fixed interest rate based on market conditions and your creditworthiness at the time of taking out the loan. Another added bonus with Figure is they offer modest discounts for borrowers who enroll in auto-pay to cover their monthly loan repayment.
If/when you apply for a HELOC, the application process with Figure takes just about 5 minutes and approval can happen immediately. Once approved, you’ll typically receive the funds within 3-5 days.
Taking out a home equity line of credit isn’t always an ideal option for homeowners, but if you have an urgent need to consolidate debts, pay off a major purchase and/or fund home repairs and renovations, then Figure’s HELOCs are great places to start funding your expenses with a reasonable interest rate and competitive loan terms.