What is the difference between a home equity loan and a home equity line of credit?
The two major differences between a home equity loan and a home equity line of credit are the interest rates and repayment policies associated with each plan.
A home equity loan usually has a fixed interest rate (amount paid on loan remains same every month) while a home equity line of credit has a variable rate (amount paid on loan each month may vary).
Home equity loans generally have a fixed monthly payment that will remain constant throughout the repayment plan. In the case of home equity lines of credit, monthly interest rates can fluctuate, which may affect the amount owed on the loan for any given month.