Posted 02/15/2018

by Aly J. Yale

Aly J. Yale is a mortgage and real estate writer based in Houston. Connect with her at or on Twitter

Share This Page

As Seen On

Renovations named top reason for HELOCs – but many still don’t know what HELOCs do


Aly J. Yale

The Mortgage Reports Contributor

Remodeling’s the reason

Home renovations are the No. 1 reason homeowners take out HELOCs – or Home Equity Lines of Credit, but that doesn’t mean they’re popular by any means. In fact, according to a new survey from TD Bank, the majority of homeowners have never even heard of a HELOC – or the ways it can benefit their home and pocketbook.

Verify your new rate (Jul 17th, 2018)


According to an on-the-ground survey conducted by TD Bank at the recent Philly Home Show, a whopping 59 percent of homeowners say they’ve never used a HELOC before. Additionally, TD Bank’s Home Equity Sentiment Index shows about one-third are unfamiliar with HELOCs.

2018: The year of HELOCs and cash-out-refinances?

For those that would take out a HELOC, the Home Show survey showed home renovations would be the biggest impetus. More than half named it their No. 1 reason; with bathroom remodels coming in top-priority. Outdoor renovations and economic renovations rounded out the top three.

Verify your new rate (Jul 17th, 2018)

Renovating for returns

Mike Kinane, TD Bank’s SVP of consumer lending, said using HELOCs for renovations can pay big dividends when it comes time to sell.

“HELOCs provide homeowners with more flexibility when making key purchasing decisions,” Kinane said. “They are a particularly attractive option for renovations because they work in a similar manner to a credit card by allowing homeowners to take out lines of credit based on the value of their home, and only requiring them to pay back what they use. The value of your home increases when you renovate, giving you a positive return on your investment should you wish to sell later on. By leveraging your home equity, you’re putting dollars back into your home while improving your living space.”

HELOC or fixed home equity loan? What’s best for you?

Still, Kinane said, HELOCs aren’t only good for remodeling.

“HELOCs are an attractive option for homeowners as the funds can be used for various purposes,” Kinane said. “Although many homeowners associate them with renovations, they can also be used for things like emergency funds, college tuition and other big purchases such as a car.”

About 18 percent of those surveyed said they would use a HELOC to pay down debts or college tuition. Another 15 percent said they’d use it to finance a new property. Just 10 percent said they’d take a vacation with the funds.

Get today’s mortgage rates

Considering a HELOC to cover your home renovations or to pay off debts? Shop around and see what rates you qualify for today.

Verify your new rate (Jul 17th, 2018)

Aly J. Yale

The Mortgage Reports Contributor

Aly J. Yale is a mortgage and real estate writer based in Houston. Connect with her at or on Twitter

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

2018 Conforming, FHA, & VA Loan Limits

Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)