Home Equity Line of Credit (HELOC) - Pros and Cons

Few major decisions are a slam dunk. If they were, life would be a lot less complicated. But most of the time, you need to weigh the pros and cons before making a choice.

Getting a HELOC, or home equity line of credit, is a major financial decision.  You need to decide whether to seek a loan in the first place, and whether a HELOC is the best choice among your options. Would a standard home equity loan be better? A cash-out refinance? Or maybe just put it all on a credit card?

To help you sort it through, here's a baker's dozen of the advantages and disadvantages of taking out a HELOC.

 First, the upsides:

1. No closing costs

If your credit is good, you won't pay any closing costs to set up a HELOC. That means no application fee, and no closing or appraisal costs. You usually have to pay those with a standard home equity.

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