Home Equity Line of Credit

Home Equity Line of Credit (HELOC) in Dallas, TX

A Home Equity Line of Credit (HELOC) is a revolving line of credit that lets you borrow against the equity in your home as needed. At First Lonestar Bank, our Texas HELOCs feature a 5-year draw period with interest-only payments, providing access to cash for home renovations, debt consolidation, or unexpected expenses while paying only for what you use.

How a Texas HELOC Works

Because Texas has unique homestead laws (Article XVI, Section 50), HELOCs in our state have specific protections and limits designed to keep your equity safe:

• The 80% Rule: Your total home debt—including your current mortgage and your new HELOC—cannot exceed 80% of your home's appraised value.
• Revolving Access: During the first 60 months (5 years), you can draw funds, pay them back, and draw them again, much like a credit card.
• Interest-Only Payments: During the draw period, your monthly obligation is based only on the interest of the amount you've borrowed, keeping your initial costs low.
• The 12-Day Rule: Texas law requires a "cooling-off" period of at least 12 days from the time you apply until you can close the loan, giving you time to ensure it's the right move for your family.

Why Tapping Your Equity Makes Sense in North Dallas

With home values in Frisco, Plano, and Prosper rising steadily, your home is likely your most powerful financial asset.

• Home Improvements: Use your equity to renovate a kitchen or add a pool, which can further increase your property value in the DFW market.
• Consolidate High-Interest Debt: HELOC rates are typically much lower than credit cards or personal loans, helping you save money while paying down debt faster.

• Emergency Safety Net: Once your HELOC is open, the funds are there if you need them, providing peace of mind without the need to apply for a new loan during a crisis.

The First Lonestar Difference

We don't just lend in Frisco; we live here. While big national banks rely on rigid algorithms, we rely on local expertise. We "bend over backwards" to understand the true value of your North Dallas neighborhood and provide a human-to-human experience from application to funding.

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HELOC Frequently Asked Questions (FAQs)

What happens after the 5-year draw period ends?

Once the draw period closes, you can no longer withdraw funds. The balance you owe is then amortized over the remaining 15 years (the standard for all our HELOCs), and your monthly payments will increase to include both principal and interest until the loan is paid off.

Is the interest on a HELOC tax-deductible?

Under current IRS rules, interest on a HELOC is generally only deductible if the funds are used to "buy, build, or substantially improve" the home that secures the loan. We always recommend checking with a tax professional for your specific situation.

How much is the minimum draw in Texas?

Per the Texas Constitution, the minimum amount you can withdraw at any one time from your HELOC is $4,000.

The Fine Print

This is not a commitment to lend; you must submit additional information for review and approval. Rates, Annual Percentage Rates (APRs), and terms are subject to change without notice. Certain restrictions apply to all programs. See your FLB Mortgage Loan Officer for complete program guidelines, loan application, applicable fees and annual percentage rates (APRs) for all loan programs. Full underwritten approval is required, and all loan approvals are subject to credit, income, and asset reviews and approvals. Bank NMLS#1215182