Using the Home You Already Own
Home Equity Options, Explained
There are three common ways to use the equity in your home. Each is built differently, and the right fit depends on your current mortgage, your goals and the costs involved.
The Three Common Options
Each summary gives the basics. Open one for more detail and what to compare.
Keeping vs. Replacing Your First Mortgage
A HELOC or Home Equity Loan generally adds a second loan and leaves your first mortgage in place. A Cash-Out Refinance replaces your first mortgage entirely. Keeping your current mortgage isn't always better, and replacing it isn't always better — the answer depends on the details.
Because a HELOC or Home Equity Loan generally leaves your existing first mortgage in place instead of replacing it, the process may sometimes be more streamlined than a full refinance. Timing still depends on the lender, property, documentation, appraisal or valuation requirements, title work and the individual transaction.
Look at the Whole Structure
Compare total costs, how long each payment lasts, whether rates can change, and how borrowing against your home affects your equity. Moving other debts into a loan secured by your home changes the risk involved, so it deserves careful review.
Compare the Options With Your Numbers
Enter your current mortgage and debts, then model hypothetical HELOC, Home Equity Loan and Cash-Out Refinance scenarios side by side.
Debt & Home Equity Comparison
This calculator is provided for educational and illustrative purposes only. Results are estimates based on the information entered and are not a Loan Estimate, quote, approval, preapproval, commitment to lend, or determination of eligibility. Actual rates, payments, costs, taxes, insurance, loan terms and qualification requirements may vary.
Let's Look at Your Situation
A short conversation is usually enough to see which options are worth comparing for you. No pressure, no obligation.
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