Home Equity Line of Credit (HELOC) Law and Legal Definition
Home Equity Line of Credit (HELOC) is a type of mortgage loan usually taken using the home equity as a security for the loan. HELOC is used for home improvements, medical bills, and purchases. The funds are obtained by writing checks against the line of credit. Interest paid on the loan is generally tax deductible. The difference between a conventional loan and a HELOC is that in HELOC, a borrower is not advanced the entire sum up front. The customer uses a line of credit to borrow sums that total no more than the credit limit.