Millions of homeowners currently hold historically low 3% fixed primary mortgages. Surrendering that low rate through a cash-out refinance to fund renovations or clear debt would be a disastrous financial move.
A Home Equity Line of Credit (HELOC) or fixed-rate second mortgage provides access to home equity without disturbing the underlying low-rate primary loan.
A HELOC operates like an emergency credit card secured by real estate, charging interest only on the funds drawn down during its initial 10-year draw period.
