What is a HELOC?

HELOC is a term for a Home Equity Line Of Credit. It is a revolving line of credit in which your home is the collateral. You are approved for a certain dollar amount of credit and may advance as needed for major expenses that might come along.

How is the HELOC structured?

The HELOC is structured into two distinct phases. First, there is a “draw period.” This is typically five years, and you are allowed to advance on the line of credit as needed. You can either advance on the line by calling your lender or linking the line to a United Bank of Iowa checking account. You make monthly payments of interest and a percentage of principal. After the “draw period” has concluded, the line of credit enters the “repayment period.” This is where you continue to repay the balance of the line in monthly payments of interest and a percentage of principal. The line cannot be advanced on during the “repayment period.”

What does having a HELOC cost?

Like with any loan, there are costs associated with a HELOC. At United Bank of Iowa, our HELOCs have a minimal processing fee that is due at closing, but there is no annual fee that is common with these types of loans. Additionally, a HELOC can be a more cost effective option compared to a traditional second mortgage loan.

How do I apply?

If you are interested in applying for a HELOC, you can stop in to any of our locations and talk to a Consumer Loan Officer. They will be able to go over the terms, underwriting, and application process.

Who would benefit from having a HELOC?

Since a HELOC uses your home as collateral, you would benefit from this product if:

• You own your home without any debt

• You have built up equity in your home by paying down your first mortgage

HELOCs can be used for any expense, but are commonly used for larger expenses such as:

• Home remodels

• Education

• Vacations

• Medical bills

You can expect the following with any of our loans:

Fast and Easy Loan Approval

We process and underwrite all of our residential real estate loans within our bank. This allows you to be approved quickly and easily.

Local Servicing

United Bank of Iowa also services all of our own loans. If you have any questions about a payment or your loan in general, you can talk to your local lender.