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Can You Have a Mortgage and a HELOC at the Same Time?

Homeowner playing with his son in their home, where they have both a HELOC and a mortgage.

Owning a home often opens the door to new financial possibilities—including access to your home’s equity. If you’re exploring ways to fund renovations, consolidate debt, or cover a major expense, you might be wondering: Can you have a mortgage and a HELOC together?

The answer is YES! You can have both a mortgage and a home equity line of credit (HELOC) at the same time. In fact, this is common for homeowners who are looking to tap into their home equity without refinancing their existing mortgage.

But as you move forward, it’s important to understand how these two products work together and what factors are worth considering. Keep reading to learn more!

Understanding the Basics: Mortgage vs. HELOC

First, let’s clarify what each loan type involves.

A mortgage is a long-term loan used to purchase or refinance a home. It typically has a fixed or adjustable interest rate and a repayment term of 15 to 30 years. Your monthly mortgage payment covers both principal and interest (and often taxes and insurance, too).

A HELOC is a revolving credit line that allows you to borrow against the equity you’ve built in your home. You can think of it as a credit card backed by your property—except with much lower interest rates and longer repayment terms.

With a HELOC, you can borrow what you need, when you need it, up to your approved limit. Most HELOCs have a draw period (often 5 to 10 years), during which you can borrow funds and make interest-only payments. After that comes the repayment period (typically 10 to 20 years). This is when you start paying back both principal and interest.

So… Can You Have a HELOC and Mortgage Together?

Yes, you can have a mortgage and HELOC at the same time. In this setup, the HELOC acts as a second lien on your home, meaning it’s secondary to your primary mortgage in terms of repayment priority. If you ever sell your home or default on your loans, the mortgage lender would be repaid first, and the HELOC lender second.

This is why lenders typically require that you have a certain amount of equity in your home before approving a HELOC. Many will let you borrow up to 80–90% of your home’s total value between your mortgage and your HELOC combined.

For example, if your home is worth $400,000 and your remaining mortgage balance is $250,000, you may be eligible to borrow up to $70,000–90,000 through a HELOC, depending on the lender’s requirements.

HELOCs and Mortgages: Why Would You Want Both?

There are several reasons homeowners may choose to take out a HELOC while still paying off a mortgage. For starters, a HELOC offers flexibility. Instead of receiving a lump sum like you would with a traditional loan, you are approved for a line of credit that you can borrow from as needed—making it a practical option for ongoing expenses such as home renovations, college tuition, or medical bills.

A HELOC also allows you to access your home’s equity without refinancing your existing mortgage. If your current home loan has a low mortgage interest rate, it might not make sense to refinance the entire loan just to tap into equity. A HELOC lets you keep your original mortgage intact while giving you access to additional funds.

Another benefit is cost. HELOCs often have lower interest rates than credit cards or personal loans, which can make them a more affordable borrowing option, especially for larger projects.

And depending on how the funds are used, the interest you pay on your HELOC may even be tax deductible.* If you’re using the funds for home improvements, for example, you may qualify for a deduction. Be sure to check with a tax advisor to understand what applies in your situation!

Things to Consider Before Getting a HELOC

Just because you can have a mortgage and HELOC together doesn’t mean it’s always the right move. Here are a few important factors to weigh:

1. Your Current Equity

Your ability to qualify for a HELOC depends on how much equity you have in your home. If you recently bought your home or haven’t paid much toward your mortgage yet, you may not have enough equity to qualify.

2. Monthly Budget

Adding a HELOC means adding another monthly payment to your financial responsibilities. While interest-only payments during the draw period can be manageable, the repayment period will eventually increase your monthly obligations.

3. Variable HELOC Rates

Many HELOCs have variable interest rates, which means your payments could go up if interest rates rise. If you prefer predictable payments, look for a fixed-rate HELOC loan or ask if you can switch part of your borrowed funds to a fixed rate.

4. Responsible Borrowing

It can be tempting to view a HELOC as free money—but it’s still a loan, and it’s backed by your home. Make sure you have a clear plan for how you will use the funds and repay them over time.

How to Qualify for a HELOC

Qualifying for a HELOC is similar to qualifying for other types of loans. Lenders typically look at:

Some lenders may also require a home appraisal or additional documentation during the approval process.

Start with a HELOC Calculator

Before applying, it’s a good idea to understand what your estimated HELOC payments look like. We offer a free home equity line of credit calculator to help you estimate monthly payments, interest costs, and how much you might be eligible to borrow based on your current home value.

Using a financial calculator early in the process gives you a clearer understanding of your budget and how a second loan would fit into your overall financial picture.

Your Next Step: Find the Best HELOC Lender

Whether you're thinking about tapping into your home equity for a renovation, emergency fund, or major expense, we're here to help you take the next step with confidence. At Academy Bank, we offer tools, guidance, and lending solutions designed to fit your needs and financial goals.

Visit your local branch or contact us today to explore your options and see how a HELOC might fit into your financial picture.

Apply for HELOC

 

Need a mortgage? Reach out to our loan officers today to get started.

* Consult a tax advisor about deductibility.

HELOCs are subject to credit approval. The HELOC product is subject to collateral approval. Geographic restrictions apply. Fees apply. Documentation requirements may apply. Additional terms and conditions apply.

Mortgages are subject to credit approval. Each loan product has specific terms, conditions, and eligibility requirements. Fees apply.