September marks the time of year that we all look forward to getting back into a routine, preparing for the "ber" months, and settling into our daily lifestyle before the hustle of the holidays. The extra time spent settling down and organizing really brings the comfort of our home life and perspective of financial security to the forefront, and — right now — everything feels expensive. Consumer debt is sitting at an all-time high —Americans are carrying more credit card debt than ever, at some of the highest interest rates in decades. Even small changes to your financial situation feel more difficult to manage than they used to.
But life doesn't stop moving. Your family is growing. The home office has slowly taken over what used to be a guest room. You need a little more storage, a little more space, a little more something — and the home you love wasn't necessarily built for who you are today. All while preparing to make the holiday season just as memorable as the last.
So, what do you do when what you need doesn't match what you can comfortably afford to change?
It turns out, you might already have the answer sitting in your walls.
Home Equity Line of Credit — Not like it used to be
A home equity line of credit allows you to borrow money from an asset you already own instead of racking up more credit card debt. However, for a lot of people, "home equity line of credit" is a phrase that still comes with some baggage - a holdover from the 2008 housing crash, when home equity products got tangled up with an entire industry's worth of bad lending decisions. That reputation stuck around a lot longer than the actual problem did, but it actually could be the solution to your situation today.
What Actually Is a HELOC?
The equity in your home is equal to the difference between what your home is worth and what you still owe toward your current mortgage associated with it. For many homeowners, especially if you've owned your home for over 5 years, this amount is significant. Since it's secured and equity backed, it typically comes with a much lower rate than your typical credit card that is unsecured and not backed by anything except your promise to pay. A HELOC sits alongside your existing mortgage, and your current rate and monthly payment remains unchanged. You're not refinancing. You're just unlocking a second tool that works next to the one you already have.
The Benefits, Beyond the Obvious
The most obvious use is access to cash - but what that access actually enables is where it gets interesting:
• Use for home renovations. Not ready to move, but you need to update things in your current home? This can increase your home value for when you feel ready to move in the future, and add extra comfort for your current lifestyle needs.
• High-interest debt gets a lot less expensive. Credit cards sitting at 20%, 25%, even 30% interest can often be consolidated onto equity-backed rates that are a fraction of that, likely leading to a credit score increase in addition to an overall lower monthly debt payment.
• Quick approval process. Funds are ready quickly and can support your needs within as little as 1-4 weeks.
• It can even set up your next move. If you're weighing a move-up purchase, equity can help fund a down payment while your current home becomes a rental instead of just something you sell.
The Boss Mortgage HELOC powered by Aven
Here's where Boss Mortgage does something most home equity lines don't: your HELOC comes with its own card. It works like a regular credit card for everyday purchases - groceries, gas, dinner out - but every purchase earns cash back, and the interest rate is lower than a standard credit card. Instead of choosing between "use my equity" and "use my credit card," you get one card that does both. When you need to take out cash for something, it doesn't come with a higher rate like your credit card offers, but with the same rate as everything else tied to your HELOC.
That financial predictability adds even more feeling of comfort to this season!