Do you have to pay back a HELOC?

A HELOC (Home Equity Line of Credit) is not free money—it's a loan secured by your home. You borrow from the equity in your home, and you're required to repay both the principal and the interest.

Here’s how it works:

Draw Period (usually 5–10 years): You can borrow money as needed and often make interest-only payments.

Repayment Period (usually 10–20 years): You can no longer borrow and must start repaying the full amount—principal plus interest.

Failing to repay your HELOC can lead to penalties, credit score damage, and even loss of your home since it’s used as collateral.

To make informed decisions about HELOCs, tools like PFScores can help you understand repayment terms, interest rates, and whether a HELOC fits your financial situation.