Home Equity Line of Credit
Cash in on your home's equity for large or unexpected expenses
Sometimes, life throws curveballs! If you occasionally need extra money for recurring payments or unexpected larger expenses, or would like to have quick access to emergency funds, our Home Equity Line of Credit (HELOC) might be just right for you. Once you've opened your SCCU HELOC, you have control — withdraw only the amount of cash you need, when you need it. And you pay interest only on the amount you use, at lower rates than many credit cards or personal loans. A HELOC gives you a specific timeframe to use the funds, followed by a repayment-only period.
Product Features
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Borrow the Amount of Money You Need, When You Need It
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Use for Consolidating Debt or for Recurring Larger Costs, like College Tuition
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Excellent Source of Easily Accessible Emergency Funds
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Low $5,000 Minimum Loan
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Choose from 7/7 or 10/10 Terms (See "View All Footnotes" under Rates below)23
- No Closing Costs17
- No Hidden Terms or Fees
- Fast Pre-qualification Decisions, Online or Over the Phone
- No Intangible Tax21
- SCCU Member Service for the Life of the Loan
- No Pre-payment Penalties
| Terms |
7/7 or 10/10 (See "View All Footnotes" under Rates below) |
|---|---|
| Application Fees |
None |
| Pre-payment Penalties |
None |
| Origination Fee |
None |
| Term | 12 Month Intro Rate APR* "As Low As" | Thereafter APR* "As Low As" |
|---|---|---|
| Principal-and-Interest Option 7/7 |
4.24% | 8.00% |
| Interest-Only Option 10/10 |
8.75% | 8.75% |
Special Introductory Rate valid on Principal-and-Interest HELOC for 12 months. Thereafter, the HELOC will have a Variable Rate feature as described below. Introductory rate not available on Interest-Only HELOC.
Your actual interest rate will be based on the available equity in your home, the amount of your loan, your credit history, and product chosen. Other programs, rates, and terms may be available. Approval is subject to our usual credit criteria. Proof of homeowner’s insurance sufficient to cover all outstanding mortgages, including your SCCU equity loan, and any other obligations secured by the home and property, is required. Certain restrictions may apply.
No Closing Costs (Home Equity Loans): SCCU will waive typical third-party fees associated with closing a Home Equity loan, such as appraisal, photo inspection, recording, state tax stamps, title exam, and title insurance. Must be primary residence. Available on loans up to $250,000. For Fixed-Rate Home Equity Loans (2nd Mortgages) in the first lien position, valued at $50,000 or more, waived costs do not include prepaid escrow amounts. Additional fees may apply for loans over $100K, and/or for special Deed preparation requirements.
You must already be a member of the credit union, or establish membership, which requires a one-time $5 deposit to open and maintain a regular savings account. Offers and rates subject to change at any time.
Current Prime Rate
Principal-and-Interest HELOC
As low as Prime minus 0.50% w/floor (minimum rate) and ceiling (maximum rate) of 18.00%
Term: 14 years, the first 7 years you may draw against/utilize the credit line similar to that of a credit card and are required to make a monthly payments equal to 1.5% of your outstanding balance, with a $100 minimum. During these first 7 years, like a credit card, as you pay your outstanding balance your available credit will be replenished and may be drawn against/utilized again. Your available credit equals maximum credit line minus total outstanding balance. During the final 7 years you may no longer draw against/utilize the credit line. Whatever balance remains at the end of the first 7 years must be paid in monthly installments. Required monthly payment equals 1.5% of the prior month's balance, with a $100 minimum payment. There is a possibility of a balloon payment at the end of the repayment period. Once the monthly minimum payment due is satisfied, you may choose to make additional payments toward the principal. The interest rate is still variable, thus monthly payments will vary depending on the current interest rates. However, as an option you may refinance to renew your credit line or convert to a fixed home equity loan.
Interest-Only HELOC
As low as Prime plus 0.25% w/floor (minimum rate) and ceiling (maximum rate) of 18.00%
Term: 20 years, first 10 years you may draw against/utilize the credit line similar to that of a credit card and are required to make minimum monthly payments equal to accrued monthly interest determined by the current interest rate and your outstanding balance. During these first 10 years, if you choose to pay more than your interest-only payment, thus lowering your outstanding balance like a credit card, your available credit will be replenished and may be drawn against/utilized again. Your available credit equals maximum credit line minus total outstanding balance. During the final 10 years you may no longer draw against/utilize the credit line. Whatever balance remains at the end of the first 10 years must be paid in monthly installments. Each monthly payment includes principal and interest, and equals 1.5% of the prior month's balance, with a $100 minimum payment. There is a possibility of a balloon payment at the end of the repayment period. Once the monthly minimum payment due is satisfied, you may choose to make additional payments toward the principal. The interest rate is still variable, thus monthly payments will vary depending on the current interest rates. However, as an option you may refinance your credit line or convert to a fixed home equity loan.
Frequently Asked Questions
A home equity line of credit, which is also commonly referred to by its HELOC abbreviation, allows you to borrow against the available equity in your home. As with most other types of loans, a home equity line of credit must be secured by collateral—with a HELOC, your house is that collateral.
Unlike a home equity loan, you won't automatically receive a single sum of money when you close on your credit line, although you may choose to do so. Instead, a home equity line of credit works more like a credit card account. You have a specified amount of credit to draw from, and your outstanding credit line balance will be reduced as you repay it. Depending on your HELOC terms (7/7 or 10/10) you will spend the first 7 or 10 years able to take funds out of your HELOC and the next 7 or 10 years paying the funds back.
The length of time you have to pay off a HELOC varies according to your specific loan terms. In general, however, your home equity line of credit will have a set time period to draw funds from the HELOC and another set time period for repayment. Typically you have the same amount of time to draw from and pay back a HELOC which may be 5, 10, 15 or 20 years. At Space Coast Credit Union, we offer 7/7 and 10/10 HELOC terms. Contact us for more information on HELOCs or easily apply online.
A number of factors are involved in the determination of your qualification for a HELOC. These include, but may not be limited to, the following:
- The amount of equity in your home: You must owe less on your home than your home is worth. Depending upon the lender and its financing terms, your equity may need to be a minimum of 15 or 20 percent of its appraised value.
- Your creditworthiness: During the application process, your credit score will be checked. A typical credit score threshold is 640 or higher.
- Your debts and income: Just as it was when you obtained your mortgage, your debt-to-income (DTI) ratio will be calculated when determining what you can afford to borrow against your home's equity. Generally, your total debts cannot exceed 45 percent of your income for a home, although some lenders offer programs with DTIs as high as 50 percent.
- Your payment history: Lenders will look at how promptly you have paid your bills in recent years.
Use Space Coast Credit Union's convenient home equity calculator on our calculators page to learn more about whether a HELOC may be right for you.
Enjoy a fast and easy online HELOC application process. We'll take your application over the phone and you'll hear back from a Mortgage Representative within one business day.
You may reach out o our Express Services Team online or by phone.
Some of the information you'll need to have handy when you apply for a home equity line of credit includes Social Security numbers and income information for all borrowers, details on your recent employment history, information on your current mortgage loan balance, and details on your bank and brokerage accounts.
Space Coast Credit Union is unable to provide a Home Equity Loan (Fixed 2nd Mortgage) or a HELOC for properties outside of the state of Florida.
How you use your HELOC depends upon your financial goals. One popular use is to reduce the rate of interest you pay on borrowed money by consolidating higher-interest debt or paying off loans with higher rates. This may be particularly important if your existing debts are financed at a rate that's several percentage points above a HELOC interest rate, which typically is lower than other types of loans. Many homeowners also secure a home equity line of credit to make major home improvements, pay college tuition, cover vacations, or maintain an emergency fund.
If you have sufficient equity in your home, you may even be able to purchase a second home or investment property. It's important to keep in mind, however, that your primary residence is your collateral, so you may not want to use your equity for a second home that you don't plan to pay off quickly.
When you want to take advantage of the equity that's built up in your home, you have a number of options, including refinancing or getting a HELOC. Either may help you achieve your goals for borrowing, but there are a few differences between the two:
- A HELOC can be an affordable way to borrow money that you plan to repay in a relatively short timeframe. You access your money as you need it, rather than take all of it at once and make payments on that full amount.
- A cash-out refinance lets you access your borrowed equity in one loan. You refinance your existing mortgage loan and have a new first mortgage. The difference between your original loan amount and your new, larger loan amount is given to you in cash.
As with any financial tool, the one that's right for you depends on what you plan to do with your equity, your personal money management habits, and other individual circumstances. At SCCU, we offer a full range of mortgage products at competitive interest rates to help you achieve your financial goals. View our latest home equity line of credit rates.
With a home equity loan, you receive the full amount you're borrowing in a lump sum, while with a HELOC, you can draw money in any increments when you need them, up to the maximum pre-approved credit line amount.
Most types of mortgage-related financing will have some costs and fees associated with them. At Space Coast Credit Union, our home equity lines of credit have no points, no loan origination fees, and no intangible tax. To learn more, we invite you to request a loan consultation with an SCCU loan officer, who will be glad to answer all of your questions.
