Using home equity for home improvement

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Renovations are the classic use of home equity — and often the smartest, because the borrowing may be tax-deductible and the project can raise the home's value. A home equity loan fits a fixed-price job; a HELOC fits a phased or open-ended one where you draw as bills arrive.

Projects that tend to pay back

Kitchen and bathroom updates, added living space and energy-efficiency upgrades usually return the most; pools and highly personal touches rarely do. Borrow for the project, not a cushion beyond it, and size it with the home equity calculator.

Estimate your equity →