Taking out a home equity loan or line of credit can positively or negatively impact your credit score, depending on how you use it. If you use the loan responsibly and make payments on time, you may see an increase in your credit score. If you decide on a HELOC as your credit facility under your home equity plan, then you must be careful not to exceed using more than a third of your limit.  Taking out a term loan or mortgage instead is best if you need to use the whole amount.