What’s The Difference Between HELOCs and HELoans?
Learn the difference between a HELOC and a HELoan, and which one is the best option for you.
Read on
Lock it in while you can.
Rates as low as 4.99% APR for 12 months won't last. If you've been shopping for rates, now is your moment to shine — and save. Borrow up to $150,000 of your home value with (get this) no closing costs**.
Flexible access to funds
Borrow what you need when you need it — so you’re ready for whatever comes next.
Competitive Colorado HELOC rates
Enjoy rates designed to save you money and give you confidence in your financial decisions.
Lock in predictability
Advance up to three fixed-rate segments, each on the terms that work for you.
Why choose Westerra?
We keep things simple and transparent.
No closing costs on HELOCs under $150K**
Rate certainty with flexible fixed-rate segments
Local service and transparent terms — no surprises
Choose your payment style: Start with interest-only payments to keep monthly costs low, or lock in a fixed rate for up to 20 years when you want predictable payments. It’s your choice, based on your budget.
Plan ahead with fixed-rate segments: Advance up to three segments, each with its own rate and term. This means you can secure stability for big projects while keeping flexibility for future needs.
Borrow, repay, and borrow again: Life doesn’t happen all at once. Our home equity line of credit lets you access funds as you need them during the draw period — without starting over.
Access funds easily for 10 years: No reapplying, no hassle. For the first 10 years, your HELOC is ready when you are. After the draw period, you’ll move into a 10-year repayment phase with no balloon payment, so you can pay down your balance in a predictable, manageable way.
Estimate your HELOC options in just a few clicks
When a HELOC loan makes sense for your goals
A home equity line of credit from Westerra Credit Union is a smart choice if you own your home and have built up equity. It’s designed for members who want flexibility instead of a one-time lump sum loan. If you’re planning ongoing projects or want a safety net for unexpected expenses, a HELOC gives you control over when and how much you borrow.
What is a HELOC loan used for?
Your HELOC can be used for almost anything that matters to you. Many members use it for home improvements, debt consolidation, tuition, or major purchases. With competitive Colorado HELOC rates and interest-only payment options during the draw period, you can borrow confidently and keep your plans moving forward. Plus, you only pay interest on what you actually use.
Looking for other ways to use your home’s equity?
A home equity line of credit is just one option. If you prefer a fixed second mortgage or want to explore energy-efficient financing, we’ve got solutions to fit your goals.
HELOC Loans and Rates: Common Questions Answered
A home equity line of credit lets you borrow against the equity in your home. Instead of taking one lump sum, you have a revolving credit line. That means you can take money when you need it and only pay interest on what you use.
A home equity loan gives you one lump sum up front and you start paying it back right away with fixed monthly payments. A HELOC works differently. You can borrow smaller amounts over time, pay them down, and borrow again during the draw period. This flexibility makes a HELOC great for ongoing projects or unexpected expenses.
Most home equity lines of credit have a draw period of about 10 years. During this time, you can access funds whenever you need them and choose to make interest-only payments or pay down your balance faster. After the draw period ends, you’ll enter the repayment phase, where you start paying back what you borrowed. It’s important to understand both your draw period and repayment period and ask your lender if your payment will balloon. A balloon payment means you would have to pay the entire remaining balance all at once when the draw period ends, which can be challenging for many members. At Westerra Credit Union, our home equity line of credit does not have a balloon payment. Instead, you’ll continue paying back your balance in a steady, predictable way based on the terms you agreed to.
A fixed-rate segment lets you take part or all of your HELOC balance and lock in a set interest rate for that amount. You’ll choose the term, and your monthly payment will cover both your interest-only balance and the fixed-rate segment. This option is helpful if you want predictable payments for part of your loan.
Interest may be tax-deductible if you use your home equity line of credit for home improvements. Always check with a tax professional for guidance, as Westerra Credit Union cannot provide tax advice.
A HELOC is versatile. Members often use it for home renovations, debt consolidation, tuition, or major purchases. It’s also great for emergencies. Even if you’re not using it, you can keep it open without paying interest until you borrow.
For most owner-occupied homes, Westerra Credit Union does not charge closing costs up to a certain loan amount. If an appraisal is needed, a fee may apply. Other costs are typically minimal.**
APR stands for Annual Percentage Rate. Most HELOCs have a variable rate that can change based on the prime rate and your credit profile. If you choose a fixed-rate segment, that rate stays the same for the term you select.
Yes. If your home equity line of credit has a variable rate, it can change over time. According to your plan disclosures, the annual percentage rate (APR) can adjust on the first day of each month. There’s no limit on how much the APR can change in a single year, but it will never exceed the maximum allowed by law. A minimum APR also applies, and the exact minimum for your plan will be disclosed when you open your HELOC. When your rate changes, your monthly interest-only payment can also change because it’s calculated based on the total loan balance from the previous month. If your rate goes up or down, your payment will adjust too. Keeping an eye on your balance and rate is important so there are no surprises.
Home equity line of credit (HELOC) payments can feel confusing because they work differently than a traditional loan. Here’s what you need to know:
Your payment is based on your balance from the previous month.
If your interest rate changes, your payment can change too.
Payments are billed “in arrears,” which means you pay for the interest that accrued during the prior month.
So, if you borrowed more funds or your rate adjusted, your next payment could increase or decrease depending on the rate and activity from the previous month. During the draw period, your monthly payment will equal the finance charges (interest) that accrued on your outstanding balance during the preceding month. You can choose to make interest-only payments or pay extra toward your balance.
After the draw period ends, you’ll start paying back the principal along with interest. The length of the repayment period depends on your balance and any rate changes, but it will never be longer than 10 years.
You can use our calculators to estimate your monthly payment and see how much you might be able to borrow:
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*LIMITED-TIME OFFER:
As low as 4.99% APR 12-month Fixed Rate promotion is available to qualified borrowers who open a new HELOC Select and advance at least $10,000 from the available line of credit at the time the Fixed Rate Segment is opened. This promotional fixed rate applies for 12 months in a fixed-rate, interest-only segment.
The Variable Annual Percentage Rate (APR) for well-qualified borrowers as of January 15, 2026, is 7.24% and is subject to change without notice. The maximum APR for a variable-rate advance is 21%. The variable rate may change after account opening.
Members must request creation of the Fixed Rate Segment within 45 days of loan origination. Westerra will assist with creating the fixed segment in-branch, by phone, or online. Conditions and restrictions apply, including but not limited to CLTV, debt-to-income ratio, and credit score requirements.
Property must be insured, owner-occupied (primary or secondary residence), and located in Colorado. Offer valid on new HELOC Select lines only. Promotion available for a limited time and subject to change or extension at Westerra’s discretion. HELOC closing costs may include title and appraisal fees based on the amount requested and CLTV. Membership eligibility required. New prime share accounts are subject to a $5 membership setup fee and a $5 minimum deposit. All loans subject to approval.
***RATE INFORMATION: 1/14/2026
The Annual Percentage Rate (APR) may change on the first day of each month. The variable rate will adjust on the first day of the month following a rate change and will be the Prime Rate as published in the Money Rates section of the Wall Street Journal plus a margin based on your creditworthiness and combined loan‑to‑value at the time of application. The margin you receive will depend on your creditworthiness and the amount of equity in your property. There is no limit on the amount by which the APR may change during any one‑year period. The maximum APR that can apply is 18.0%, or the maximum permitted by law, whichever is less. A minimum APR will apply to this plan. A representative minimum APR of 4.0% has been used in the payment examples throughout this disclosure. The specific minimum APR applicable to your plan will be disclosed on the HELOC Addendum when you establish your plan. The floor rate is 4.49% APR. APR for fixed‑rate advances of $5,000 or more will be set at the time you agree to a fixed‑rate advance and is based on the term and the original application. This fixed rate will remain in effect for the full term of the fixed‑rate subaccount, which cannot exceed the term of the loan.
**CLOSING COSTS: Closing costs are waived for loan amounts $150,000 or less and apply to owner‑occupied loans only.
FEES AND CHARGES: You must pay certain fees to third parties to open the plan. These fees generally range from $200.00 to $2,000.00. Upon request, we will provide an itemization of the third‑party fees you will be required to pay. If an appraisal is required, an appraisal fee will be assessed. Other loan closing costs may range from $175 to $275.
