The top 7 ways to use a HELOC

A home equity line of credit can be a great way to get quick access to cash for major purchases

March 13, 2023

For more information on HELOCs, check out our downloadable guide.

Tapping into your home’s equity is a great way to get quick access to cash and knock some big items off your to-do list. With a home equity line of credit (HELOC), your credit limit will be based on your current home valuation, and it offers the flexibility of accessing the money when you need it. A big benefit of a HELOC: You only pay interest on what you actually use.

Here are seven common reasons to take out a HELOC:

1. Home improvements

One of the main reasons homeowners take out a HELOC is to tackle a home renovation or remodel project. Making improvements to your home not only makes it more comfortable and aesthetically pleasing, but certain upgrades can also have a significant impact on your home’s overall value.

According to research, the top two areas of a home to upgrade are kitchens and bathrooms. Done right, they add the most resale value.

2. Emergency expenses

We say it all the time: It’s always a good idea to have an emergency fund, and your home’s equity can help. Covering large medical bills, the loss of a job, or any other unexpected or costly life event can be a good reason to utilize your equity.

3. Education expenses

Using the equity in your home can also be a smart way to pay for college, because a HELOC may offer a lower interest rate than other loan options.

4. Travel

While some vacations can be covered within a family’s normal budget, many popular destinations can cost thousands of dollars. Using a HELOC can help finance your vacation plans without the worry of using a credit card or putting a strain on your normal budget.

5. Medical care

If you have medical bills at risk of going to collections or an elective procedure you’re putting off for a rainy day, you can use your HELOC to pay for either issue. Get it done and get back to enjoying life again.

6. Weddings

Many folks use their home equity to pay for a wedding, whether it’s theirs or their child’s. If you’re needing more money for that special day, you can tap into your HELOC for a much-needed cash infusion.

7. Passion projects

A HELOC is a great way to fund your pricier hobbies, like restoring old cars, building furniture, or outdoor adventuring (think kayaks, canoes, and the like).

Every time you pay down your mortgage loan or do something to increase the value of your home, you build equity. Equity is a major benefit to owning a home and a key piece of a homeowner’s financial security. These are just a handful of ways you can utilize your equity, but truly the possibilities are endless.

We hope you found some of our tips helpful! This article is part of the Fund Your Dreams, part of UBT's Five Principles of Financial Wellness Series. 


  • Personal
  • Managing Your Money
  • Owning a Home
  • Home Equity

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