Common HELOC Questions

Many people own homes in which the value of the property exceeds existing mortgage debt. A HELOC, or Home Equity Line of Credit, is a lending product that allows members to borrow from and repay a line of credit with a credit limit determined by the available equity value in their home.

1. How does it work? After the application has been completed and necessary documents have been submitted, an appraisal is ordered to determine the current market value of the home. The maximum credit line you may apply for is 85% of the equity in your home up to $200,000. Because a HELOC is secured to a high value asset, we’re able to offer better rates and terms than an unsecured loan. Members may choose between fixed and variable rate options, as well as 5 & 15 year terms.
2. Does my home need to be paid off? No! It is very common to have a HELOC along with a mortgage, as they are often referred to as a “second mortgage.” Other than factoring in a debt-to-income ratio, your existing mortgage will only affect your maximum credit line, as the remaining balance of the mortgage will be subtracted from your equity subtotal when calculating your credit limit.
3. Do I have to pay closing costs or other fees? No! As long as the home appraisal reflects enough value to pursue the HELOC, a draw of $10,000 occurs within the first 6 months, and the line of credit remains open for at least 3 years, then the member will never be asked to pay any application fees, appraisal fees, or closing costs.
4. How do I make payments? Payments are made directly to AFCU. All lending decisions and loan servicing are performed 100% in-house locally by Amherst FCU staff. No hassle of dealing with outsourced third-party services.

Published May 1, 2026