A home equity line of credit allows a home owner to borrow sums of money from the lender. The lender agrees to lend a maximum amount within an agreed period, and the borrower uses the loan as a line of credit, pulling from it when needed. In many ways this is similar to a credit card. You are assigned a specified credit limit that you may borrow up to. A home equity line of credit often has a draw period of five to 25 years, allowing you access to the funds when needed. You are required to pay back the amount you actually borrow plus interest. Often the interest paid is deductible under federal and many state income tax laws, which makes the cost of borrowing not so high.