Finance House

Hi All,

I am currently negotiating a Home Equity Line of Credit and had a couple of questions.

1. How do Home Equity Lines of Crredit show on your credit report? Are they revolving, installment, mortgage or something else?
2. Will my Home quity Line of Credit affect my credit score like a credit card based on balance to limit ratios?

I am concerned that when I get my line of credit and then pretty much deplete it completely will it drastically affect my score like if I went out and maxed out all my credit cards. Thanks for the fedback!

j

HELOC= Home Equity Line of Credit
Which is basically a revolving credit based out of the equity of your home. It will show up as a second mortgage on your credit report. It also will affect your score like it would a major credit card.

HELOAN= Home Equity Loan
Which is a loan based off of the equity of your homw but it is a set amount. Which will make it into a installment loan. It will also show on your credit report as a second mortgage but will be shown as an installment loan, like how your car loan is shown on the CR.

Might want to have this info checked on but im pretty sure this is correct as I have researched this.

Unfortunately, how a HELOC is reported (installment vs. revolving status) depends upon your financial institution.

Most times a HELOC is reported as a revolving type account (like a credit card); subject to the "utilization" effect on your credit score.

However, sometimes banks report them like a mortgage, and code it as an installment type account. This happened in my case.

In the end, you will not know unless you ask up front how it will be reported, or until its processed and then reported.