If you already have a low-rate first mortgage, replacing the whole loan may not make sense.

That is where a HELOC can become interesting.

Imagine you owe $250,000 at 4%, but you need another $75,000.

Instead of refinancing the entire $325,000 balance at today’s higher rates, you may be able to keep the first mortgage and borrow only the additional $75,000 through a HELOC.

Now you have two payments, but most of your debt stays at the lower rate.

A HELOC can be useful for:

• Paying off high-interest debt
• Home improvements
• Investment property down payments
• Emergency reserves
• Major expenses

The best choice depends on the rate, payment, closing costs, and how quickly you plan to repay the money.

Don’t compare rates alone. Compare the total monthly cost.

---