If you need to borrow money, home equity lines may be one useful source of credit. Initially at least, they may provide you with flexible amounts of cash at relatively low interest rates. An Equity Credit Line offers you the flexibility of ready cash, at a low interest rate, whenever you need it -- simply by writing a check.

Home Equity Credit Line
A home equity credit line allows you to borrow against the equity in your home. You can use it to pay for a vacation, home improvements, debt consolidation or even your daughter's tuition. Accessing your credit line is as easy as writing a check and as the principal is repaid, you'll be able to use it again. You can also establish fixed rate loans for specific purposes under your credit limit with a set monthly payment.

Because your Home Equity Credit Line is secured by your home, the interest rate is generally lower than with other loan types. There are minimal or no setup fees and in most cases the interest is tax deductible (be sure to consult your tax advisor).

Pros

• Flexible access to funds
• Potential tax advantages
• You only draw what you need
• You only pay interest on what you borrow

Cons

• Ties up equity making it unavailable for other needs
• Higher interest rate than a first mortgage