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Wells Fargo offers a revolving credit line for homeowners called Home Equity of Credit, or HELOCs. This line of credit is an open-ended, revolving loan that allows future advances up to the approved credit . You find the money for home improvements, debt consolidation, medical expenses, investment opportunities, starting a business, education, car or boat, or any other major expense. Since Wells Fargo's Home Equity Line of Credit are revolving loans, you can employ only the money you want when you need it, much like credit cards.

This credit is ready any time during your draw period with handy access through your Wells Fargo card, checking account, ATM, online banking, or local bank. The draw period of a Home Equity Line of Credit is the amount of time the line of credit is open, usually ten years, after which the line of credit is closed and repayment starts. Advances removed during this draw period may have small monthly payments in which only minimal amounts are paid toward the principle with the rest of the payment going to accrued interest, or interest only payments may be made. Wells Fargo offers plans that allow repayment of the Home Equity Line of Credit loan over a set time period draw period is now finished. Some of these plans allow up to 30 years repayment time.

Interest of Wells Fargo Home Equity Line of Credit is variable and bound to the Prime Lending Rate, the rate in which most major banks charge their largest and most credit worthy customers. This variable rate normally has a cap to restrict how high of an interest rate can be charged and some have limits as to how low the interest . Variable rates are subject to quarterly adjustment though some plans offer a limited interest. The interest paid on Wells Fargo Home Equity of Credit is only paid on the funds that are employed and is commonly tax deductible.

Like Home Equity Loans, Home Equity of Credit have fees that might appear to be charged for removing the loan. Some plans call for one-time; fees while others have annual fees. Plans that low monthly payments during the draw period may require a balloon payment at the end of the loan period requiring the whole remaining balance to be paid. Other fees can also apply such as appraisal fee, credit check fee, and closing costs. The Federal Truth in Lending Act protects the borrower by requiring the lender to inform the borrower of all charges and terms when is given.

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Tags: Home loans, mortgage, Refinance