What is the difference between a Home Equity Loan and a Home Equity Line of Credit?

Funds from a Home Equity Loan are disbursed in full at the time of closing. This loan has a set repayment term and monthly payment amount.

A Home Equity Line of Credit (HELOC) provides you with a revolving credit line where you can obtain credit advances for the draw period up to the credit limit set at the time the loan was opened. The payment amount is calculated on the highest amount owed and does not decline as the balance declines; payment is reset upon obtaining a zero balance.