What Is a Home Equity Loan?

A home equity loan (HELOAN) is a type of secured loan that allows you to borrow money using your home’s equity as collateral. Once you have your money, you can use it on anything from medical expenses to college tuition to home renovations. 

Because of how a home equity loan works, home equity loan rates in Massachusetts are typically lower when compared to credit card and personal loan rates. This means that a home equity loan in Massachusetts can be a good way to consolidate debt, as you can convert all of your debts into one payment at a relatively low rate. 

When you apply for a home equity loan in Massachusetts, the amount of equity you have in your home is a key metric. Lenders will typically allow you to borrow up to 85 or 90 percent of the equity you have in your home, so your loan amount is dictated by your current equity. 

With a standard HELOAN, you’ll receive your money in one lump sum with a set loan term that typically lasts between five and 40 years. You must repay your loan by the end of the loan period or before you sell your home. If you sell your home before repaying your loan, the money you owe will be taken out of the sale price.

There are different types of home equity loans available in Massachusetts and, in most cases, you’ll need to provide W-2s and tax returns to apply for a loan. However, Griffin Funding also offers a bank statement HELOAN for self-employed individuals.


When you’re using your home equity to apply for a loan, you can apply for a home equity loan (HELOAN) or a home equity line of credit (HELOC) in Massachusetts. It’s important to understand the difference between a HELOC and home equity loan in order to choose the right option for your needs.

A HELOAN is a traditional secured loan that allows you to use your home’s equity as collateral. Using your home as collateral makes it easier to get approved for a loan and you can often borrow larger amounts at competitive interest rates. You’ll receive your money in one lump sum, so you should only borrow what you need. Since this is a fixed-rate loan, your monthly payment will stay the same throughout the entirety of your loan term.

On the other hand, a HELOC is a line of credit you can open using your home’s equity as collateral. Lenders look at how much equity you have in your home and give you a set spending limit based on your equity. You can spend up to this limit like you would with a credit card, and your monthly payment will depend on the amount you spend. HELOC rates in Massachusetts are adjustable, so your monthly payment will also depend on whether HELOC rates in MA change, which can be as often as every month.

There are benefits to both HELOANs and HELOCs, so you should make your decision based on your situation. HELOCs may offer more flexibility in terms of spending, but HELOANs tend to be a more straightforward solution if you know how much you need to borrow. Before applying, make sure to look at HELOC rates in Boston or any other city in the state where you’re considering buying to get a better idea of the costs associated with a HELOC. 

Pros and Cons of Massachusetts Home Equity Loans

Home equity loans can be a smart move as long as you borrow responsibly and pay your loan off on time. However, there are some potential pros and cons you should be aware of before pursuing this financing option. 

Some of the pros of home equity loans in Massachusetts include:

  • Griffin Funding offers competitive rates on home equity loans.
  • You can get quick access to the funds you need for your next project or expense.
  • There are virtually no restrictions on how you spend your HELOAN funds.
  • Lower interest rates and longer loan periods make Massachusetts home equity loans a favorable alternative to credit cards and personal loans.
  • You can keep your low mortgage rate when applying for a HELOAN or HELOC.
  • You may be able to write off the interest on your HELOAN as a tax deduction. 

You should also consider these downsides before applying for a loan:

  • Taking out a home equity loan increases your total debt burden. 
  • You can lose your home if you can’t pay your loan back on time.
  • The process of obtaining a home equity loan involves paying closing costs and fees. 

How to Qualify for a Home Equity Loan in Massachusetts

The amount of equity you have in your home is a key deciding factor in whether or not you get approved for a loan. At Griffin Funding, we look at several factors when reviewing your loan application, including:

  1. Lenders generally require that you have at least 15-20 percent equity in your home in order to take out a HELOAN. At the end of the day, you’ll have to retain 5-15 percent of your equity after receiving HELOAN funds. Depending on the type of home equity loan you choose you’ll need either a full appraisal or an AVM.
  2. We look at your credit score and debt-to-income ratio to make sure you’re a responsible borrower.
  3. The last thing we look at is your mortgage payment history and income. If you have a history of making on-time mortgage payments and earn enough money to make monthly HELOAN payments, this will benefit you in the approval process. 

If you’re concerned about your credit score or debt-to-income ratio, you can use the Griffin Gold app to monitor your credit and take control of your finances.

Access Competitive HELOAN and HELOC Rates in Massachusetts

Home equity loans in Massachusetts offer competitive rates and longer loan periods, making them a better alternative to credit cards and personal loans in many cases. When used responsibly, Massachusetts home equity loans can be a great way to secure cash flow for home improvement projects, emergency expenses, and more.

Griffin Funding offers competitive HELOAN and HELOC rates in Massachusetts, helping you secure the funds you need by capitalizing on your equity. With our easy online application, you can apply in just a few minutes. Contact us or apply online to get started with a home equity loan in Massachusetts.