What type of fees must be disclosed for a home equity line of credit (HELOC)?

When it comes to a home equity line of credit (HELOC), all fees that could be associated with the account must be disclosed to the borrower. This includes annual fees, which are recurring costs charged for maintaining the line of credit, as well as transaction fees, which may occur when the borrower draws funds from the HELOC. The requirement for these disclosures is part of Regulation Z, which aims to ensure transparency and informed decision-making by consumers.

The reason annual and transaction fees are specifically highlighted is that they can significantly impact the overall cost of borrowing, and borrowers need to understand these costs upfront to compare different financing options accurately. Transparency in disclosing these fees helps consumers avoid surprises and allows them to make better financial decisions.