Key Takeaways:
- A HELOC is like a secured credit card where the collateralized limit is based on what you’ve currently paid down on your mortgage – otherwise known as your home’s equity.
- Re-using your home’s equity to make energy-efficient, cost-effective renovations to your home can not only save you money in the long run on utility bills, but it can also potentially increase its resale value.
- Out-of-date or end-of-life central heating and cooling units can be huge energy drains, raising utility bills either due to loss in efficiency, or lack of effectiveness.
- Appliances, lighting fixtures, insulation, thermostats, window and door frames, and solar panels are also high-importance areas to take into consideration when determining the energy efficiency of one’s house.
Did you know that as a homeowner, one of the smartest moves you can make is to take the money you’ve paid down on your home and use it to make energy-efficient improvements that’ll save you more in the long run?
Whether your gutters are clogged and cracked, there’s a draft coming from who knows where in the upstairs hallway, or the furnace starts making that weird noise you forgot started at the end of last winter – a home equity line of credit, or HELOC, is the ultimate financial tool for making those key investments today that can mean serious savings tomorrow.
Plus, there’s still time to tap into this flexible source of funds and qualify for No Closing Costs*! Apply by December 31 with qualifying automatic payments and an advance of $25,000 at closing to put even more money where your house is.
What is a HELOC?
A HELOC is just like a secured credit card, but the collateral that secures the limit is based on your equity. That’s the difference between what your home is worth and how much you’ve paid down on it.
While a traditional home equity loan is opened for a specific, one-time amount, once you open a HELOC, you only have to take out what you need, when you need it, and only ever pay back what you use.
Another benefit to a HELOC is your draw period. This is the length of time you have to advance funds. At Visions, that’s a ten-year draw period.
How can I use a HELOC to save money on energy bills?
A good start is to look at your central heating and cooling units. If it’s been more than ten years since you last checked on your HVAC system, it might be time to look at what’s on the market – especially if your energy bills keep climbing.
Even if your system doesn’t need replacing just yet, putting some money towards yearly maintenance can be a great way to make sure your central cooling is running as cost-effectively as possible.
That 15 to 20-year-old furnace could also use a look. If you know your furnace is approaching or at its life expectancy, and your bills keep going up or the machine isn’t running like it did before, a HELOC can be a great way to finance a more efficient and reliable replacement. Plus, it’s better to act now rather than wait for the furnace to give out and leave you without heat in the dead of winter.
Additionally, a smart thermostat can pair well with your updated heating and cooling. No one likes walking into a house that’s freezing but leaving the heat on while you’re away is a huge waste. With a smart thermostat, you can adjust the temperature of your home from anywhere with your smartphone – so just turn on the heat right before you head home and you can still enjoy stepping into a toasty house, but with greater control and a reduced price.
What other cost-effective upgrades could I make with a HELOC?
Insulation – A modern furnace can only do so much if your attic keeps losing all the heat it’s trying to circulate – but adding insulation can make a big difference in your utility bill.
Window and Door Frames – Any gaps in windows and door frames can be notorious for letting in drafts and causing your AC or furnace to work harder depending on the season, so you can use your HELOC to smooth over any problems there, too.
Appliances – Think about it: your fridge is on 24/7, you’re using your washer and dryer multiple times per week, and the same goes for your stove and dishwasher – so making sure that these appliances are running as efficiently as possible is crucial, not only for saving money, but for keeping your day-to-day as smooth as possible, too.
Lighting – Lighting is one of the most important features that makes your house a home, but it also drives up your home's energy bill. While switching out heat-generating incandescent bulbs for energy-efficient LEDs and CFLs can definitely help, try taking this concept to the next level with motion sensors, timers, and smart lighting fixtures.
Go Solar – Solar panels are a huge investment, but they also could end up paying for themselves as they work to save you thousands of dollars every single year. Not only would your house become more self-sufficient, but it would also very likely increase your home’s resale value – so you can enjoy the benefits now and enjoy them again later!
Whether you’re taking on huge projects like solar panel installation and HVAC maintenance, or you’re just looking to make your home a little smarter with a few upgrades here and there, taking out a HELOC is a great value, cost effective way to future-proof your home’s efficiency, practicality, and comfort.
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