What Is a HELOC?
A Home Equity Line of Credit (HELOC) is typically a revolving line secured by your home. It often has:
- A draw period during which you can borrow, repay and re-borrow up to the limit.
- Variable interest rates in many cases (though some fixed-rate options may exist).
- Interest-only payments during the draw period in many structures, with repayment later.
A HELOC is usually in second position behind your main mortgage, but in some cases it may be the only lien.
What Is a Fixed Second Lien?
A fixed second lien is typically a separate, closed-end loan secured by your home that:
- Has a fixed interest rate and a scheduled amortization period.
- Provides a lump sum at closing.
- Is repaid in regular payments, separate from your first mortgage.
Some borrowers use a fixed second lien to access equity while keeping their existing first mortgage.
Why Compare HELOC / Second Lien vs. Full Refinance?
Depending on your current rate, goals and time frame, it may or may not make sense to replace your first mortgage. Some reasons people explore HELOC or second-lien options instead of a full refinance include:
- Current first-mortgage rate is significantly lower than today’s rates.
- They only need a specific amount of cash, not a complete restructure.
- They want flexibility to pay down and re-use a line of credit.
Others decide that a full refinance (sometimes with cash-out) is cleaner. The right path depends on your numbers and priorities.
Key Points to Compare
- Total payment when you combine first mortgage + HELOC/second vs. a single new mortgage.
- Interest rate risk if the HELOC rate is variable.
- Closing costs, fees and any early-termination charges.
- How long you expect to keep the property and the loans.
Using the calculators on this site can help you frame questions before you talk through details.
How to Explore Your Own HELOC / Second-Lien Scenario
- Use Payment Breakdown to understand your current mortgage structure.
- Use Refi Savings Over Time to see what a full refinance might look like.
- Make a simple list of how much cash you might need and for what purpose (repairs, debt consolidation, etc.).
- When you’re ready, start a secure application via Apply Now or request a written outline via Get Your Plan.