How to Access a Home Equity Line of Credit

By Julia Fuller

  • Overview

    Having a home equity line of credit can provide an inexpensive method of borrowing money when used wisely. Interest rates on home equity lines are typically well below credit card interest rates; some are actually below the prime rate. The interest paid on a home equity line of credit may also be tax deductible on federal income tax for those able to itemize, further decreasing the costs of borrowing compared to other methods.
    Your home provides collateral for a home equity line of credit
    • Step 1

      Write a check to access your home equity line of credit. Shortly after you are approved for your home equity line of credit, you should receive a checkbook in the mail. Like the checks you write from your personal checking account, you fill in the name of who you are paying and the amount. The amount of each check you write is added to the principal balance you owe. It reduces your available credit.
      Write a check
    • Step 2

      Use a debit card to access your home equity line of credit. Your bank should send you a debit card to access your line of credit, as well as a unique pin number in a separate envelope. You can use the debit card at the bank, in stores or in various ATM machines.
      Use a debit card

    • Step 3

      Go to the bank in person to request cash or a cashier's check drawn against your home equity line of credit. You can withdraw the amount needed in cash. You can have a cashier's check made out to yourself or to another person or company.
    • Step 4

      Access your home equity line of credit from a personal computer over the Internet. You can use automatic bank transfers to pay bills online or transfer the money to your checking account to pay bills.
    • Step 5

      Have the bank wire transfer the money directly. Banks are able to transfer money directly to another bank when the routing number and account number are known.
    • Skill: Easy
    • Tip: Credit lines can be kept open in case of emergency without maintaining a balance owed.
    • Tip: Educational expenses, adoption expenses, major home repairs, and unexpected medical bills are common uses for home equity lines of credit.
    • Warning:
    • Use your equity line with caution. Failure to make payments can result in the loss of your home.
    • Equity lines should not be used for daily living expenses.

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