To Buy A Car — Heloc

: Stretching the loan over a 20- or 30-year period can significantly reduce your monthly cash outlay compared to a 5-year car loan.

: 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?

: 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.

: You can withdraw funds as needed—usually over a 10-year "draw period"—to pay for the car in full.

: Vehicles lose value quickly—roughly 60% over 5 years . If you use a 20-year repayment term, you will likely owe money on the car long after it has reached the end of its life.

Using a to purchase a vehicle allows you to leverage your home's value to potentially secure a lower interest rate or more flexible repayment terms. However, this strategy involves significant risks that differ from traditional auto financing. How It Works