HELOC: Understanding Home Equity Lines of Credit

What is a HELOC?

A Home Equity Line of Credit is a form of revolving credit in which your home serves as collateral. And since your home is most likely your largest asset, why not put it to work for you and take advantage of all the benefits a C•U•D HELOC offers! Access to your money is easy and our Equity loans are flexible enough to fit your specific needs for home improvements, bill consolidation, college tuition, a family vacation or whatever you can dream up!

How a HELOC Works

Much like a credit card that allows you to borrow against your spending limit as often as needed, a HELOC gives you the flexibility to borrow against your home’s equity.

For example, say you have a home worth $400,000 with a balance of $250,000 on your first mortgage and you want to access up to 80% of your home’s equity. You can establish a HELOC with up to a $70,000 limit:

  • $400,000 x 80% = $320,000.
  • $320,000 – $250,000 = $70,000.
  • $70,000 would be the amount you could use, for this 80% combined loan to value example.


However, Credit Union of Denver has higher combined loan to value options, up to 100%, if you want to borrow a higher amount. Use our Home Value Calculator to see what your home may be worth.

A HELOC has two phases. First is the draw period, followed by the repayment period.

During the draw period, you can borrow from the credit line by checkbook or card. The length of the draw period for Credit Union of Denver is 10 years.

How do you pay back a home equity line of credit?

Payments on a HELOC are not much different than a credit card. Minimum monthly payments are required. The re-payment terms are at least a 1% payment on the outstanding balance. This is true for the entire 20 year term. During the repayment period, or last 10 years of the HELOC, you can no longer borrow against the credit line. Instead, you pay it back in monthly installments that include principal and interest. If you don’t pay off the total due in that last 10 years, it will end up having a balloon payment for the balance owed.

See our current special

Limited Time Offer - Home Equity Line of Credit. New Backyard deck


What can I use it for?

After you qualify for a certain amount, use your HELOC for things like: Home improvements, education, debt consolidation, medical bills, or a much needed vacation. The choice is yours!

Simply use your issued MasterCard® with your HELOC and checks (if you elect them) to access your equity funds.

  • Check out how our home equity loan choice will work best for you. Read Our HELOC Disclosures Here.
  • HELOC rates as low as 3.99% APR* through 12/31/2021!
  • $0 Annual Fee
  • $0 Closing Costs, in most cases
  • 80%-100% CLTV**
  • Access funds via check or credit card
  • Ability to re-use funds as you pay down the balance

Credit Union of Denver is your trusted financial resource that has your best interests at heart. We will be on your side to help you through each and every step of the way!

To speak to a loan specialist, please call 303.202.5659 or 800.489.7852

Member Card Alerts

We offer a protected MasterCard® HELOC card that comes with Member Card Alerts. These are alerts that you set up to notify you of certain types of account activities. You can elect to have alerts sent to you via email and/or text messaging (keep in mind your phone plan to know if there are extra charges involved) for any or all of the following reasons:

  • Purchases over an amount of your choosing
  • Online purchases – Card is not present at time of purchase
  • International transactions – (email alerts only when traveling)
  • Declined purchases

Bonus: Setting up Card Alerts is a great way to monitor your accounts without having to login! Learn more Card Alert details, how to get signed up and view the FAQ’s.

  • Follow this link to sign up your HELOC MasterCard for Card Alerts today!


Line of credit or home equity loan?

Choosing the right home loan program that is best suited to your needs and financial situation is the first most important step. Another option we offer is a Fixed Rate 2nd Mortgage. As opposed to a HELOC, with a revolving line of credit, a home equity loan provides a lump-sum withdrawal that’s paid back in installments.

Home equity loans have a fixed interest rate. This may provide you piece of mind, knowing your monthly payments will remain the same. We are here to help you decide which option is best for your financing needs.

Read more about a 2nd Mortgage here.

Experience Smart Banking – Call 303.239.1150 or 800.279.3288 today

* 2.99% & 3.99% APR (Annual Percentage Rate) are special promotional rates & are good on new HELOC loans opened or applications submitted January 1, 2021 – June 30, 2021. With approved credit. 2.99% APR not to exceed a **Combined Loan to Value (CLTV) of 80%, 3.99% APR not to exceed 90% CLTV, both have a term of 20 years. Special rate is good for 12 months from closing date. Variable annual percentage rate (VAPR) will apply after promotional period ends and is based on credit worthiness at time of application. Best rate is 0.50% [“Margin”] below Wall Street Journal Prime Rate “Index”] subject to the floor rate of 6.00% and ceiling rate of 18.00%. No closing costs in most cases, but an appraisal and/or title insurance may be required at member expense. Not available on refinance of current CUD mortgage loans. Owner occupied and Colorado properties only. Subject to credit approval. Terms and conditions subject to change without notice. NMLS: #417000. HELOC disclosures.