A traditional Home Equity Loan (HELOAN) is a financial product that allows homeowners to borrow a lump sum of money by tapping into the equity they’ve accumulated in their home. Unlike a Home Equity Line of Credit (HELOC), which operates as a revolving credit line, a HELOAN provides a one-time, upfront payment of a fixed amount. This loan is typically repaid over a predetermined period, often ranging from 5 to 30 years, with consistent monthly payments and a fixed interest rate throughout the life of the loan. HELOANs are particularly suited for borrowers who need a specific amount of money for large, one-time expenses, such as home improvements, debt consolidation, medical bills, or significant purchases. Because the loan is secured by the property, the home acts as collateral. If the borrower is unable to make the required payments, the lender has the right to foreclose on the home, potentially resulting in loss of property. With its predictable payments and fixed terms, a HELOAN provides financial stability and a clear repayment plan. However, it is important for homeowners to carefully assess their ability to meet the loan obligations, as their home equity is on the line. Additionally, closing costs and fees are similar to those in the original mortgage process, making it crucial to weigh the costs against the financial benefits.