Finance
What is a 'home equity line of credit' (HELOC) and how does it work in Delaware?
AA fixed-rate second mortgage providing a lump sum to the homeowner
BA revolving line of credit secured by the homeowner's equity, allowing borrowing up to a credit limit, repayment, and re-borrowing during the draw period — typically with a variable interest rate✓ Correct
CA government program for Delaware homeowners to fund energy efficiency improvements
DA mortgage product available only to first-time homebuyers in Delaware
Explanation
A HELOC is a revolving credit line secured by the homeowner's equity. During the draw period (typically 10 years), the borrower can draw, repay, and redraw up to the limit. The rate is typically variable (prime + margin). After the draw period, the outstanding balance enters a repayment period. HELOCs are commonly used for home improvements and debt consolidation.
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