Home Equity Loan
Direct definition
A fixed-rate, lump-sum second mortgage secured by your home's equity.
Written by the Vabasso Mortgage Editorial Team · Reviewed against agency and federal sources · Read our editorial policy for how we research and review mortgage content
Plain-English explanation
Unlike a HELOC, a home equity loan disburses all funds at closing and repays with fixed monthly payments over a set term.
Why it matters
Predictable payments and a fixed rate make it attractive when you have a defined project or debt to consolidate.
Where you may see it
- Loan Estimate
- Closing Disclosure
- Mortgage statement
A real-world example
You take a $60,000 home equity loan at a fixed rate for 15 years to consolidate higher-interest debt.
Educational and illustrative only
A common misunderstanding
A home equity loan is not the same as a HELOC — it disburses funds as a lump sum with fixed payments rather than a revolving line.
Ask Vabasso AI
This glossary provides general educational information. Mortgage terminology, qualification methods, forms, timelines, fees, program rules, and legal meanings may vary by lender, investor, loan program, property, occupancy, state, and transaction. Definitions do not represent loan approval, legal advice, tax advice, or a commitment to lend.
- Author
- Vabasso Mortgage Editorial Team
- Reviewed by
- Vabasso Mortgage Licensed Advisory Team
- Last reviewed
- July 30, 2026