Home equity loan as often called as a second mortgage. It will allow you borrow the sum of money by using the home equity. Equity is the value attached to an asset. You home equity would be the value of your house in the fair market minus any existing loan or mortgage on the same.
The home equity loans saw a boom in the year 1996 when it started providing a way to the borrowers to have the existing taxes circumvented in that year. Since it allow deducting the tax on the interest when it comes to tax returns.
Home equity loans are usually for 5-15years based on fixed or variable interest rates. Fixed interest rate loans are provided as a onetime payment which the borrower is supposed to pay over a set period of time. The interest is agreed upon by the borrower and the lender at the beginning of the loan. The benefit for the borrower here is that the payments and the interest rates do not change over the life of the loan.
Home equity loans are offered in the form of line of credit as well. It works more or less like a credit card. Some of the lenders do offer a credit card as well with the line of credit against the home equity. This allows a borrower to have a pre-approved credit line and borrower  can spend as much as he wants out of the credit line and repay it back. The payment of the loan is only for the amount that is used out of that credit line. Also the interest rate charged is as prevailing in the market. The end of the credit line period asks the customer to pay back the remaining amount in full.
Home equity credit is beneficial for borrowers as they get ready cash easily. The interest rate is much low as compared to the credit cards. The borrower gets money for debt consolidation, medical bills, education, investment etc.  Also the interest paid on the home equity loan is tax deductible which is not the case on credit cards. This allows the borrower save a lot of money. The borrower consolidates the debt and ensures lower payments and tax deductions.
Lenders have the benefit of earning interest and fees attached to the borrowed money. In case borrower fails to make the payments on time the lenders have the right to keep the initial payment. This is not the end. The lender will possess the property put as collateral for the loan and would do a foreclosure in public auction to recover his money.