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HELOCs and home equity loans in Washington

A HELOC (home equity line of credit) or home equity loan is a second mortgage that lets you borrow against your equity while keeping your existing first mortgage and its rate. A HELOC works like a credit line you draw from as needed; a home equity loan pays a lump sum at a fixed rate. Lenders set how much you can borrow by combined loan-to-value, credit and income.

HELOC vs. home equity loan vs. cash-out refinance

OptionHow you get moneyBest when
HELOCDraw as neededOngoing projects or flexible access; you want to keep a low first-mortgage rate
Home equity loanLump sum, fixed paymentOne known expense; you want a fixed rate
Cash-out refinanceReplaces your first mortgageCurrent rates are near or below your existing rate

Common uses

  • Renovations and ADUs
  • Down payment on an investment property
  • Paying off higher-interest debt

Many lenders allow a combined loan-to-value of 80%–90% on a primary residence and lower on rental properties. Exact limits depend on the lender, your credit and the property.

See also: refinance options.

Common questions

Can I get a HELOC on a rental property?

Some lenders offer HELOCs or home equity loans on investment properties, usually at lower combined loan-to-value limits than on a primary residence.

Will a HELOC change my first mortgage rate?

No. A HELOC is a separate second mortgage, so your existing first mortgage and its rate stay in place.

What clients say

I’m so grateful to have had Kristen as our loan officer during our home-buying journey. Buying a home can be incredibly stressful, especially with all the moving pieces involved, but Kristen was always there to answer my questions, explain things clearly, and keep everything moving forward. She was patient, responsive, and genuinely cared about helping my family get into our new home. I never felt like just another client. Thank you, Kristen, for all your hard work and for helping make this experience so much smoother for us. We truly appreciate you!
★★★★★Charisse S.Posted on Google

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