Equity Answers - Links:

A home equity loan is a fixed or adjustable rate loan secured by equity in one's primary residence. The interest paid is usually tax deductible. Home equity loans are often used for home improvements or to replace other types of consumer loans that are not tax deductible and have higher interest rates.

A home equity line of credit is a variation where the bank provides a credit that the borrower can tap by writing checks or getting an advance. A home equity line of credit is a great way to pay off other debt such as credit cards and auto loans.