If you don’t have money for a down payment but do have a lot of equity in your current home, you could consider taking out a second mortgage to finance your down payment. There are two options to consider: a home equity line of credit (HELOC) or home equity loan.

Both options allow you to borrow against the equity in your home. The main difference is that with a HELOC, you’ll get a credit line that you can borrow against, similar to a credit card. With a home equity loan, you’ll get a lump sum of cash. For both you’ll be paying interest on the amount you borrow each month. Got a HELOC, the interest rate is usually variable, and a home equity loan typically has a fixed rate. The good news is that you can pay down a home equity loan as quickly as you’d like to lower monthly payments on the credit line.

If you’re considering taking out a home equity loan or HELOC, you’ll need to act very early in the process since lenders considering you for the loan on your new home will want to see that the money has been in your bank account for several months.