1) HELOC interest is still tax deductible, so long as it's used on something to improve your home. Not sure what you have to provide or document to prove what you are doing with it, but the interest on a $25K HELOC is only ~$90/month so it's not a significant deduction. Deducting it would save you about $250/year on your taxes, but as I demonstrated earlier, when used over the first 10 years of a loan it can eliminate around 70 payments (which in my example is over $120K in payments). I'll give back $250/year in tax deductions for eliminating $120K in payments. 2) With a HELOC, you only have to pay interest during the 10-year draw period. You do not have to pay back the principal until after 10 years. 3) I explained how it works with my real-life example earlier in the thread. If you don't believe it, get a mortgage schedule (Excel can generate one for you) and run it for yourself. I ran it on my mortgage schedule ($400K loan, 3.25% interest with a $25K HELOC at ~4.3% interest) and it eliminated ~70 payments, or over $120K in payments in the first 10 years. 4) It was compared to making extra payments on a mortgage. It's way, way, better than making extra payments on a mortgage.