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What to Know About a Home Equity Loan

An ESL Home Equity Loan is a fixed and steady solution to help finance life’s expenses. Interested in learning more? Here are four important benefits, plus key terms, to remember.

Infographic of What to Know About a Home Equity Loan

Finance a Major Purchase

A Home Equity Loan allows you to borrow against the equity of your home. Many financial experts recommend only tapping into your home’s equity for projects or purchases that will increase its value.

  • Equity: The difference between the current fair market value of the property and the amount still owed on the property.

Consolidate Higher-Interest Rate Debt

You can consolidate higher-interest rate debt with a Home Equity Loan, which features a fixed term at a fixed rate and no closing costs.1 This is a great option when you have multiple higher-interest rate debts to consolidate into one streamlined payment.

  • Fixed Rate: A fixed and steady rate that never changes over the life of the loan and is helpful when borrowing a lump sum of money that’s paid back over time.
  • Closing costs: Expenses typically due at closing, including an appraisal fee, taxes, title searches, credit report charges, and other fees.

Simplify Budgeting and Planning

In a rate-fluctuating environment, a Home Equity Loan gives you stability with one consistent monthly payment at a fixed rate. You can pay it back over time with a variety of repayment options up to 20 years.

  • Fixed rate: A variable interest rate loan can change over the life of the loan, whereas a fixed rate will never change over the life of a loan.

These features are different than a Home Equity Line of Credit, which offers more flexibility at a variable interest rate. Learn the difference between a Home Equity Loan and a Home Equity Line of credit here. If you think a Home Equity Line of Credit looks like a better option for you, our Credit Line Calculator can help you determine how much you can borrow.

Borrow Up to 90% of Your Loan-to-Value

You can borrow up to 90% of your LTV ratio, as determined by the appraised value.

  • LTV: Loan-to-Value, a lending assessment. The appraised value or property valuation vs. the total of the loan.
  • Appraised value: The value of the property, based on factors like location, condition, and recent sales of local properties.

1: Property insurance and flood insurance, if applicable, are required. ESL will pay all the closing costs and fees in connection with the opening of your account. However, if you close your account within the first 36 months of your account open date, you must reimburse us for the closing costs and fees paid in connection with opening your account. Definitions developed from and Learn more about Home Equity Loans by going to