If you need cash for a big project or debt consolidation, a second mortgage or home equity line of credit might be the answer. Both options are available to homeowners. Plus, the loan process is relatively easy and most homeowners qualify for cash. While the concept behind a second mortgage loan and a home equity line of credit are similar, the two are very different.

Persons who apply for a second mortgage loan receive a lump sum of money from their mortgage lender. This is a one-time payout, and borrowers must determine a loan amount in advance. On the other hand, if you prefer to access cash over an extended period, then a home equity line of credit is a better choice. With a HELOC, borrowers can access a line of credit for 10 to 15 years. They can withdraw money when needed, and use the cash for a variety of purposes. This option is perfect for homeowners who need cash over a period of time.

To qualify for both loan options, you'll need equity. Since your home's equity secures the loan, you can get approved with less-than-perfect credit. In fact, the money from a second mortgage loan or home equity line of credit can be used to pay off debts and improve a low credit score.