If you’re a homeowner with credit card debt, you’ve likely considered taking out a home equity line of credit to help pay off your debt. A home equity line of credit is considered revolving credit from your mortgage lender that uses your home as collateral, and it usually has a considerably lower interest rate than credit cards. A home equity line of credit differs from a home equity loan because it doesn’t provide you with money in one lump sum – it allows you the access to the money as you need it, much like a credit card.

A recent article on the Equifax Finance Blog, “Should I Use a HELOC to Pay Off Credit Card Debt?,” discusses what you need to know before choosing this option.

• This type of loan is secured against your home, offering a lower interest rate and saving you money over the life of the loan, as well as on the monthly payment.

• With a home equity line of credit, you can claim the interest paid as a tax deduction if the line of credit is below $50,000 or $100,000 for couples filing jointly.

• Lenders are going to mitigate risk by requiring you to keep a certain amount of equity in the home. This means that you may never be able to borrow against the full amount of the home, so keep that in mind.

• Repayment plans will vary with a home equity line of credit, and you may have principal remaining after the repayment period is over. It could also require you to pay the entire remaining principal balance at once when the repayment period ends.

If you’re considering taking out a home equity line of credit to help pay off debt with a high interest rate, be sure to read the full article on the Equifax Finance Blog.