HELOC vs Home Equity Loan
| Feature | HELOC | Home Equity Loan |
|---|---|---|
| Rate type | Variable | Fixed |
| Payment | Interest-only option | Fixed monthly |
| Access | Revolving credit | Lump sum |
| Best for | Ongoing expenses | One-time expense |
| 2026 rates | 8-10% | 7-9% |
Best Uses for Home Equity
Good:
- Home improvements (may be tax deductible)
- Debt consolidation at lower rate
- Education expenses
- Emergency fund backup
- Vacation or luxury purchases
- Risky investments
- Covering daily expenses