10/29/2026
YOU ASKED: “What’s the difference between a HELOC and a second mortgage?”
I get this question all the time, so here’s the straight answer.
Technically, both are second mortgages. Both let you use your home equity without refinancing the mortgage you already have. The difference is in how you get the money and how you pay it back.
A HELOC (home equity line of credit) works like a credit card backed by your home. You draw money as you need it, and during the draw period you generally pay interest only on what you’ve used. The catch is that most HELOCs have variable rates, so your payment can change over time. It’s a good fit for renovations where you don’t know the final cost.
A fixed-rate second mortgage, also called a home equity loan, gives you the full amount up front at a fixed rate with predictable monthly payments. If you know you need $75,000 for a kitchen, debt consolidation or a major purchase, there are no surprises if rates go up.
The simple version: if you need flexibility, look at a HELOC. If you want a fixed payment, look at a second mortgage. Either one can let you keep your low first-mortgage rate exactly where it is.
What else do you want to know about home equity? Ask in the comments and I’ll answer as many as I can, here or in an upcoming video.
Scott Reynolds | NMLS #2678105| Equal Housing Opportunity
