Ozark Living

What is a HELOC? Homes symbolize many different things, including an investment in one's future. Bank of America says a home equity line of credit, oen referred to as a HELOC, is a line of credit secured by your home. It is a revolving credit line that can be used for various expenses. e Credit Union of Southern California reports that a HELOC credit line is issued by a lender and has a limit and variable interest rate that is secured by the equity in your home. A HELOC is similar to a credit card in that they both provide revolving credit. Investopedia says revolving credit is an agreement that permits an account holder to borrow money repeatedly up to a set dollar limit while also repaying a portion of the current balance due in regular payments over time. But unlike credit cards that may have high interest rates, the interest rates of HELOCs oen are lower - a significant advantage when paying off large amounts of borrowed money. Home equity accessed through a HELOC can be a great source of value for future renovations, large purchases such as cars, educational expenses, and alternative debt repayment. e credit limit of a HELOC depends on your credit standing and unpaid debts. It also is determined by the market value of the home and how much you owe on your mortgage. According to Credit Karma, banks tend to limit the amount borrowed to no more than 85 percent of the appraised value of the home, minus what is owed on the mortgage. HELOC terms also vary, but they can run for as long as 30 years. Even though there are many benefits to HELOCs, there is a downside to using a home as collateral. Investopedia says home equity lenders place a second lien on the home (in addition to the first mortgage lien). Defaulting on HELOC payments can result in legal action and a home being repossessed. Another potential pitfall is a lender may reduce or freeze your credit line aer missed payments. Even though banks attempt to limit how much can be borrowed through HELOCs to help avoid potentially negative situations, they are not without risk. Borrowers considering a HELOC have other options, including home equity loans. Homeowners can speak with financial advisors to learn more about their options for maximizing equity in their homes. to compromise the area's comfort levels. ere is no hiding from noise in an open floor plan, as sounds from voices, television shows and appliances tend to echo and blend together. And if the home is a single-story layout, those noises from the main living areas also may carry to adjacent bedrooms. Smoke and smells are another thing to consider. When something on the stove spills over, a small range hood will not be practical for clearing smoke from a large space. ough the aroma of freshly cooked food is enticing, it can make it hard for cooks to keep guests out of the kitchen. Open-concept homes are popular, but homeowners should weigh the pluses and minuses to see if this trend is truly right for them. Appliances Consumer Reports notes that luxury home buyers expect high-end features, including professional ranges and built-in refrigerators that match the surrounding cabinetry. However, many mainstream brands offer "faux pro" features that can equal more expensive alternatives. Consumer Reports even notes that many budget-friendly faux pro appliances outperformed their high-end counterparts in terms of reliability. Countertops Countertops tend to capture the eye's attention when walking into a kitchen. Outdated and/or damaged countertops grab that attention for all the wrong reasons, while updated countertops made from today's most popular materials provide that wow factor homeowners seek. If granite is a must-have, Consumer Reports notes that homeowners can save substantial amounts of money by choosing granite from remnants at the stone yard. If marble is your ideal countertop, save money by choosing a domestic product as opposed to one imported from overseas. Cabinets Custom-built cabinets may be a dream, but they tend to be a very expensive one. Such cabinets are designed to adhere to the dimensions of the kitchen, and Consumer Reports notes that they can cost tens of thousands of dollars. If that estimate would bust your budget, examine the current layout of the existing cabinets. If the layout is fine but the cabinets need work, you can give them a whole new look by refinishing them. If the cabinets must go, stock units or semi-custom cabinets can provide a new look without busting the budget. Kitchen remodels can be expensive. But there are many affordable ways to revamp a kitchen. OZarK LIVING • March 2022 • 31

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