When people think of taking out a Home Equity LIne of Credit (HELOC,) the most common reason is to do home renovations or a simple home project. It gives people access to their home’s equity in order to improve their home.

HELOCs aren’t reserved solely for home projects. They can be used for any large expense you have coming up that you want to use credit for. Here are a few ways to utilize funds from your HELOC.

Paying for College

Going to college is incredibly expensive, with costs going up every year. The average in-state tuition for Idaho is $11,262 a year, which is not something people can pay out of pocket easily. If you have a child, a spouse, or if you're going to college, using a HELOC is a great way to pay for tuition.

Being able to draw on your HELOC over time makes it a great solution for this expense.  Each semester can be paid for when the bill comes due. Then, until the draw period ends, you only have to pay on the interest each month. After that, you pay a monthly rate to pay off what you borrowed in the HELOC.

Covering Medical Bills

Medical bills can be a major expense people have to take care of. Whether it’s for a minor issue or an emergency situation, medical bills can get high very quickly. Insurance can help with a majority of it, but the remainder can leave a person deep in debt.

This can give you more time to get money for the expenses and depending on your situation, have a lower interest rate than medical loans. Be sure to explore all options before deciding on a HELOC, as there might be a better solution for your specific situation.

Handling Miscellaneous Costs

Life can hit you fast. Even if you prepare for normal expenses, like car repairs or home maintenance, the unexpected can happen, leaving your savings drained. If you are starting to get overwhelmed by expense after expense, opening a HELOC can give you a bit more control over your situation.

A HELOC is an open line of credit you can use for a specific period of time. When an expense comes up that you are not prepared for, you can use your HELOC to pay it off and  have some time to save up to pay for it later. This can be a lifesaver if you are going through an unexpected period of repairs, expenses, and necessary costs you have to cover.

Consolidating Your Debt

If you find yourself gaining more and more debt, especially credit card debt, consolidating your debt should be something you consider. Letting your debt run rampant could leave you in trouble with high interest rates and monthly payments you can’t keep up.

By consolidating your debt into a HELOC, you gain more time to recover financially and start paying off your debt. While the HELOC is open, you have to make monthly payments on the interest accumulated, but don’t have to make payments on the principle until you are ready or the payment period begins at the end of the HELOC’s term. This can transform making several payments to different lenders into a single payment every month down the road.

Improving Your Home

If you plan on making extensive improvements or repairs to your home, a HELOC is a great way to finance it.

A HELOC is great for this is because it’s an open line of credit for a set period of time. Whether it’s major home repairs or a big renovation job, fixing up a house takes time. Having a HELOC at your disposal can help group together these expenses over the years your big project takes place, from buying supplies to paying for contractors.

If you have some of these expenses, or other big ones coming your way, open a HELOC with Pioneer! Need to get approved fast? We go there with our QuickLOC option. You can get approved in days, not weeks, giving you a HELOC option much quicker.

Learn More About HELOCs!