A home equity loan allows homeowners to borrow against the equity they have built in their property, which is the difference between the home’s market value and any outstanding mortgage balance. This type of loan provides funds that can be used for major expenses, like home renovations, education, or debt consolidation, typically with lower interest rates than unsecured loans. Home equity loans usually have fixed interest rates and monthly payments, giving borrowers predictability in repayment. They are popular options for homeowners looking to utilize their property’s value.