Experts generally advise against using home equity for a car unless you have a rock-solid repayment plan and can secure a rate significantly lower than an auto loan. For most buyers, a traditional auto loan remains the safer choice because it does not tie your primary residence to a depreciating asset.
: Once the draw period ends, you enter a repayment phase (often 10–20 years) where you pay back both principal and interest. heloc to buy a car
: Since you pay the dealership in full with HELOC funds, you may have more power to negotiate a better price. Experts generally advise against using home equity for
: Under 2026 IRS rules, interest on a HELOC is only deductible if the funds are used to buy, build, or substantially improve the home securing the loan. Interest on funds used to buy a car is not tax-deductible . Summary: Is it worth it? : Since you pay the dealership in full
: You are approved for a credit limit based on your home's equity (typically up to 80-85% of its value minus your mortgage).
: The most critical risk is foreclosure . If you fail to make payments, you could lose your home, whereas an auto loan failure only leads to car repossession.