Best Credit Union for a HELOC in Reading, PA

Bellco Federal Credit Union is happy to partner with homeowners in Reading, PA, as the best credit union for a HELOC, or Home Equity Line of Credit. We’re able to provide a compassionate and professional touch throughout the process. 

As a member of Bellco FCU, you can take advantage of lower rates and fees when you borrow against your property’s equity. A Home Equity Line of Credit, or HELOC, lets you borrow in a cyclical manner, much like a credit card. 

HELOC Highlights:

  • Includes two terms – a “draw period” for spending and a repayment period

  • The credit limit will typically be limited to about 85% of home equity

  • Borrowers are able to pay down the balance and spend again up to the credit limit

  • Failure to repay places home at risk for foreclosure

Benefits of Joining Bellco FCU

It’s definitely easy to join Bellco FCU. If your place of residence, employment, worship, or education is in Berks County, PA, or if you have a spouse, child, parent, or sibling who is a member of the credit union, you’re qualified to become a member. With a deposit as small as $5 and a few subsequent steps, you’ll be a member. 

No matter whether you leave your current job, retire, or move out of the area, you’ll be able to remain a Bellco FCU member for life and can access your accounts from anywhere by mail, fax, telephone, online and at thousands of ATMs across the nation.

Applying for a HELOC

To qualify for a HELOC, you will need to provide appropriate documentation to establish that you have sufficient equity, income, and credit. The best rates will come to those who can demonstrate low debt-to-income ratios and significant assets. 

To figure out how much you could borrow, subtract the balance you owe on your mortgage (and any the other loans secured by your property) from the appraised value of your home. If, for example, your home has a value of $200,000 and you owe $120,000 on loans secured by your property, your equity is 40%, or $80,000. 

Different lenders have different guidelines, but it is common to see HELOCs offered with a Loan-to-Value (LTV) between 80% and 90%. Using the home described above, which is worth $200,000 and has $120,000 still owed on the mortgage, the homeowner could qualify to borrow a maximum of $40,000 (80% LTV). 

HELOC vs. Home Equity Loan

A Home Equity Line of Credit (HELOC) can provide you with a certain amount of money, usually between 80-90% of the value of your home equity. The HELOC works somewhat like a credit card, and is made available to you for a limited time period (typically 5 or 10 years). During what is called a “draw period,” you can withdraw funds from the line of credit whenever you need them. As you pay off the principal, your credit revolves, and you can use it again and again for the duration of the draw period.

The traditional Home Equity Loan is a second mortgage that is secured by the equity in your home and provides funds to you in a lump sum at a fixed rate for a fixed term (up to 15 years). It is similar to refinancing your mortgage, but without many of the closing costs. The loan is repaid in budget-friendly fixed monthly payments, just like your original mortgage.

When you’re in need of funds, Bellco FCU is here to help. We’re the best credit union for a HELOC and other financial products in Reading, PA.