You may have seen a jump in your home’s equity recently. According to CoreLogic, the average homeowner saw their equity increase around $20,000 in the third quarter of 2023. That may be why, according to Finder’s Consumer Confidence Index, 25% of Americans either have, or plan to get, a HELOC in 2024.
HELOCs, or home equity lines of credit, are revolving lines of credit often used for home improvements, debt consolidation or unexpected bills. If you have at least 15% to 20% equity in your home, a HELOC can be an affordable way to borrow. But you must keep up with your payments or you risk losing your home.
As of January 2024, the average rate on a HELOC is 8.91%. However, HELOC rates can vary widely, depending on the prime rate and your creditworthiness. Also, HELOC rates are typically variable, meaning they rise and fall with the prime rate – usually on a quarterly basis.
When you’re comparing lenders, consider the max capped rate, which should be around 18%, depending on the state. Our list of the best HELOC lenders offer some of the most competitive rates, low fees and flexible repayment options.
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When you apply for a HELOC with U.S. Bank, it considers your full credit history, not just your credit score. This makes it a good choice for people building or rebuilding credit. It also has some of the most competitive HELOC rates available – with no origination fees or closing costs. And when you factor in discounts, rates can be as low as 8.95% APR.
Lines start at $15,000 and go up to $750,000, sometimes higher. There's a 10-year draw period, during which you're able to select a minimum monthly payment of 1% to 2% of the outstanding balance, or make interest-only payments. You don't have to pay closing costs, but if you close the line within the first 30 months, you'll pay an early closure fee of 1% of the loan value, up to $500. U.S Bank also charges an annual fee of $90 after the first year.
Min. Credit Score
660
Fixed Rate Option
Yes
Annual Fee
$75
APR
8.95% to 13.10%
When you apply for a HELOC with U.S. Bank, it considers your full credit history, not just your credit score. This makes it a good choice for people building or rebuilding credit. It also has some of the most competitive HELOC rates available – with no origination fees or closing costs. And when you factor in discounts, rates can be as low as 8.95% APR.
Lines start at $15,000 and go up to $750,000, sometimes higher. There's a 10-year draw period, during which you're able to select a minimum monthly payment of 1% to 2% of the outstanding balance, or make interest-only payments. You don't have to pay closing costs, but if you close the line within the first 30 months, you'll pay an early closure fee of 1% of the loan value, up to $500. U.S Bank also charges an annual fee of $90 after the first year.
Pros
Fair credit OK and $0 closing costs
Option to convert your HELOC balance to a fixed rate
PNC Bank allows you to lock balances of $5,000 or more into a fixed-rate account with a term of 5 to 30 years for a $100 balance transfer fee. This means you can watch the market and transfer to a fixed rate when interest rates are down — and you can switch the balance from fixed back to variable for another $100 fee.
PNC bank doesn't provide a typical range for APRs, but when asked they state rates typically fall around 8.19% to 14.55%. PNC charges an annual fee of $50, but waives closing costs as long as you keep the credit line open for at least 36 months.
Min. Credit Score
620
Fixed Rate Option
Yes
Annual Fee
$50
APR
8.19% to 14.55%
PNC Bank allows you to lock balances of $5,000 or more into a fixed-rate account with a term of 5 to 30 years for a $100 balance transfer fee. This means you can watch the market and transfer to a fixed rate when interest rates are down — and you can switch the balance from fixed back to variable for another $100 fee.
PNC bank doesn't provide a typical range for APRs, but when asked they state rates typically fall around 8.19% to 14.55%. PNC charges an annual fee of $50, but waives closing costs as long as you keep the credit line open for at least 36 months.
Pros
$0 closing costs
No origination fees in most states
Discounts available for autopay customers
Lock in a fixed rate during the draw period for a fee
Cons
Origination fees apply in CA and NY
Must open PNC checking account to get autopay discount
Bethpage Federal Credit Union (BFCU) offers some of the lowest introductory rates available, especially if you have good credit. It offers an intro 6.99% APR fixed rate for the first 12 months if you draw at least $25,000. After that, it charges a rate based on the Prime Rate, which could be as low as 8.5% APR for the best credit borrowers.
BFCU doesn't charge application, origination or appraisal fees. It also doesn't charge closing costs on lines of up to $500,000 — as long as you keep it open for three years. The minimum draw on a BFCU HELOC is only $100 and there's an option to convert your outstanding balance of $10,000 or more to a fixed-rate loan. But watch out for high early closure fees.
Min. Credit Score
620
Fixed Rate Option
Yes
Annual Fee
$0
APR
8.5% to 18%
Bethpage Federal Credit Union (BFCU) offers some of the lowest introductory rates available, especially if you have good credit. It offers an intro 6.99% APR fixed rate for the first 12 months if you draw at least $25,000. After that, it charges a rate based on the Prime Rate, which could be as low as 8.5% APR for the best credit borrowers.
BFCU doesn't charge application, origination or appraisal fees. It also doesn't charge closing costs on lines of up to $500,000 — as long as you keep it open for three years. The minimum draw on a BFCU HELOC is only $100 and there's an option to convert your outstanding balance of $10,000 or more to a fixed-rate loan. But watch out for high early closure fees.
Pros
Option to convert balance to a fixed-rate loan
$0 closing costs on up to $500,000 if kept open for three years
Join BFCU with a $5 deposit on a new checking account
Cons
Only allows you to convert balances of $10,000 or more to a fixed rate
Best rates only available after an initial draw of $25,000
LendingTree isn't a lender — it's an online marketplace that partners with a range of HELOC and home equity loan lenders across the country. You complete an application, and LendingTree pairs you with a list of lenders you might qualify with, along with an estimate of the rates and terms you might receive.
You save time, get several offers and may even get a lower rate than you could on your own – since lenders are competing for your business. But you must agree to share your information with a wide range of lenders, which can lead to a flood of marketing calls and emails well after you've closed on your HELOC.
Min. Credit Score
620
Fixed Rate Option
Varies by lender
Annual Fee
Varies by lender
APR
Starting at 6.88%
LendingTree isn't a lender — it's an online marketplace that partners with a range of HELOC and home equity loan lenders across the country. You complete an application, and LendingTree pairs you with a list of lenders you might qualify with, along with an estimate of the rates and terms you might receive.
You save time, get several offers and may even get a lower rate than you could on your own – since lenders are competing for your business. But you must agree to share your information with a wide range of lenders, which can lead to a flood of marketing calls and emails well after you've closed on your HELOC.
Pros
Nationwide network with hundreds of partners
Complete one application to get multiple offers
Streamline research with verified reviews
Get alerts on better deals
Cons
You may get calls, emails and spam after you close
A HELOC can take up to six weeks to fund. But not with Figure. Figure's application process uses blockchain technology, which means you could have funds as soon as five days from approval. You can get as much as $400,000 with a fixed interest rate and have up to 30 years to pay it back– but you'll be on the hook for a 4.99% origination fee on your initial draw.
While it offers fast turnaround compared to other HELOC lenders, Figure is one of the few HELOC lenders that charges an origination fee. On Figure's minimum draw amount of $20,000, that's nearly $1,000 in fees. Since origination fees don't apply to many HELOCs – you'll need to decide if paying this fee is a fair tradeoff for faster funding.
Min. Credit Score
640
Fixed Rate Option
Yes
Annual Fee
$0
APR
Starting at 8.75%
A HELOC can take up to six weeks to fund. But not with Figure. Figure's application process uses blockchain technology, which means you could have funds as soon as five days from approval. You can get as much as $400,000 with a fixed interest rate and have up to 30 years to pay it back– but you'll be on the hook for a 4.99% origination fee on your initial draw.
While it offers fast turnaround compared to other HELOC lenders, Figure is one of the few HELOC lenders that charges an origination fee. On Figure's minimum draw amount of $20,000, that's nearly $1,000 in fees. Since origination fees don't apply to many HELOCs – you'll need to decide if paying this fee is a fair tradeoff for faster funding.
Pros
No prepayment penalties or annual fees
Interest rate discounts available
Apply in minutes and get funded in as few as five days
Competitive APRs and relationship discounts
Cons
Minimum $20,000 initial draw required
Origination fee of 4.99% on initial draw
Not transparent about APR range
Blockchain technology can cause old records to interfere with a new application
This Big Four bank has a strong HELOC program with multiple rate discounts. Automatic payments from your Bank of America checking or savings account reduce your rate by 0.25%. Preferred Rewards members can cut their rate by 0.125% to 0.375%. The lowest HELOC rate is 1.99% (including autopay discount and initial draw discount), which is lower than most competitors. But the maximum rate is 18%, which is comparable to other lenders on our list.
Bank of America offers an initial draw discount of 0.1% for every $10,000 withdrawn and a 0.25% discount for HELOCs in the first lien position. HELOC limits range from $25,000 to $1 million. And you can convert up to 90% of your line into the fixed-rate option with no fee.
Min. Credit Score
620
Fixed Rate Option
Yes
Annual Fee
$0
APR
Varies
This Big Four bank has a strong HELOC program with multiple rate discounts. Automatic payments from your Bank of America checking or savings account reduce your rate by 0.25%. Preferred Rewards members can cut their rate by 0.125% to 0.375%. The lowest HELOC rate is 1.99% (including autopay discount and initial draw discount), which is lower than most competitors. But the maximum rate is 18%, which is comparable to other lenders on our list.
Bank of America offers an initial draw discount of 0.1% for every $10,000 withdrawn and a 0.25% discount for HELOCs in the first lien position. HELOC limits range from $25,000 to $1 million. And you can convert up to 90% of your line into the fixed-rate option with no fee.
Pros
$0 closing costs, application fees and annual fees
Multiple rate discounts on HELOCs
High borrowing amounts up to $1M available
Cons
Introductory rates start higher than other lenders
Charges a $450 fee plus waived closing costs for early closure
Discounts may not make rates as low as other lenders
BMO Bank offers HELOCs with credit limits ranging from $25,000 to $150,000. APRs widely vary by term — with lower rates offered to longer terms— and loan amount. For example, if you're willing to borrow more than $150,000 and lock the rate, you could secure a fixed rate as low as 7.74% APR.
Your HELOC's variable rate can be locked into a fixed rate for no fee through 2024, but if you wish to unlock it, a $75 fee will apply – which is lower than US Bank's and PNC Bank's fees. While BMO Bank doesn't charge closing fees on its HELOCs, you'll be responsible for paying an annual fee of $75.
Min. Credit Score
650
Fixed Rate Option
Yes
Annual Fee
$75
APR
Starting at 8.34%
BMO Bank offers HELOCs with credit limits ranging from $25,000 to $150,000. APRs widely vary by term — with lower rates offered to longer terms— and loan amount. For example, if you're willing to borrow more than $150,000 and lock the rate, you could secure a fixed rate as low as 7.74% APR.
Your HELOC's variable rate can be locked into a fixed rate for no fee through 2024, but if you wish to unlock it, a $75 fee will apply – which is lower than US Bank's and PNC Bank's fees. While BMO Bank doesn't charge closing fees on its HELOCs, you'll be responsible for paying an annual fee of $75.
Pros
0.50% autopay discount with a BMO checking account
Closing costs waived for lines that stay open 36+ months
Finder’s lending experts analyze more than 25 HELOC lenders to choose and update our top picks for HELOC lenders.
Each lender is weighed across 10 key metrics:
Annual fee
Credit limits
Minimum and maximum APR
Introductory rates
Discounts
Closing costs
Customer reviews
Requirements
Turnaround
Regional footprint
We also factor in extra features like the ability to lock in a fixed rate and the willingness to lend against second homes.
We regularly update our best picks as HELOC products change, disappear or emerge in the market and to reflect the most competitive products available.
See the best HELOC rates available to you today
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What is a HELOC?
A HELOC is a revolving line of credit that allows you to borrow against your home’s equity. Your credit limit is based on the value of your home, minus the amount you owe on your mortgage, if you have one.
HELOCs are similar to home equity loans with one main difference: Home equity loans give you a lump sum of money, while a HELOC allows you a line of credit to spend what you need, as you need it. That means you repay only what you draw from the account.
Because a HELOC is secured by your home, using your home as collateral, HELOC interest rates are typically lower than the rates you’ll find on a credit card or personal loan. But if you default on the loan, you can lose your home.
The terms and features of your HELOC may vary by lender, but typical HELOCs offer you a 10-year draw period to use your credit line and a 20-year term to repay the loan. During the draw period, you’re only required to make interest payments, though you can repay as much as you like. During the repayment period, your payments are made up of principal and interest and are amortized — which means your principal and interest are spread out into fixed payments, with more of your payment going to interest at the start of your loan.
How HELOC rates work
HELOC rates are almost always variable, meaning your actual rate can change in reaction to the lending market, typically every month or quarter. Lenders usually calculate variable rates by adding a fixed interest rate — called a margin rate — to the prime rate. The margin rate you receive is based on factors like your credit score, the amount of your credit line, your initial draw and the LTV of your home.
For example, if the prime rate is 8.5% and the margin is 1.25%, your HELOC rate is 9.75%. But if the prime rate rises to 9%, your rate rises to 10.25%.
HELOC introductory rates
Introductory rates are low, fixed rates that lenders charge during the first 6 to 12 months of the HELOC to entice borrowers. But they come with some restrictions.
For example, some lenders offer introductory rates only to borrowers who are willing to draw a large chunk of their credit limit right away. Any discounts you’ve earned, such as existing customer or auto-pay discounts, won’t start until the introductory rate is over. And after the introductory period ends, a variable rate applies to your outstanding balance as long as you keep the line open.
How high can my HELOC rate increase?
Most lenders cap how high your rate can increase — usually at the legal maximum, which is 18% for most states. Most lenders also have a floor rate on HELOCs, which is the lowest rate it can be, often around 3% to 3.25%, depending on the lender and the rate you qualify for.
This means that even if the prime rate reaches 20%, your rate will never top 18%. It also means that you’ll never get a rate lower than 3% or 3.25%, even if you qualify for a 0% margin rate and the prime rate is 2%.
To protect yourself against high interest rate shocks, talk to your lender about instituting a lower rate cap. You can also ask about fixing the rate on your outstanding balance. While you’ll likely pay a slightly higher rate on a fixed line, your payments are more predictable.
Fixed-rate HELOC options
To help you avoid rate fluctuations, many lenders allow you to roll over portions of what you have drawn into a fixed-rate HELOC. For example, If you’ve drawn $15,000 of your credit line, you can roll over $10,000 into a fixed-rate account and start making regular payments on the amount immediately. This allows you to lock in an interest rate that will not change, even if the prime rate changes.
Most lenders charge a fee for fixed-rate options and have a limit on the number of accounts you can open. You may also get to choose between several loan terms for the account — from 5 to 30 years, depending on the program.
Who a HELOC is best for
A HELOC may be a good financing option if you have more than 20% equity in your home, a good credit score of at least 680 and enough available income to repay the loan.
Lenders may create stricter requirements during an economic downturn, such as a higher credit score or income requirements. It means you may have a more difficult time qualifying, or may receive a higher margin rate than you’d get otherwise.
If you take out a HELOC while your home’s value is up and rates are high, keep in mind that you typically have a 10-year draw period and are not obligated to borrow right away. You could tap into your home’s current equity but choose to borrow later when rates are lower. You’ll pay interest only on what you borrow.
When a HELOC might not be a good idea
If your credit score is low and interest rates are high, it might not be the time to take out a credit line. While some lenders allow borrowers to have FICO scores as low as 620, that score will be reflected in a higher interest rate.
In addition to closing costs and annual fees, a higher rate could make a HELOC more expensive than HELOC alternatives. At the very least, be sure to read the fine print before applying, and be sure to ask about potential fees and contingencies. If you’re concerned about closing costs or tapping into home equity, consider a personal line of credit instead.
7 ways to get a low rate on your HELOC
Compare multiple lenders. Don’t limit your search to major banks. Look to credit unions and online lenders to see what rates and relationship discounts are available.
Maintain a good credit score. The lowest rates are reserved for borrowers with a FICO score of 740 or higher. Avoid raising financial red flags before you apply for a HELOC, like closing or opening credit cards.
Lower your DTI. Most lenders prefer a debt-to-income ratio of 47% or lower to open a HELOC. The lower your DTI, the better your chance of approval.
Open a larger line. The lowest rates are reserved for borrowers who open lines of $25,000 to $100,000 or more and take a set minimum draw. Do this only if it makes financial sense, since you’re paying interest with a higher balance.
Look for relationship discounts. Lenders like Bank of America offer relationship discounts that can lower your HELOC rate by 0.25%, 0.50% or more. But compare offers, as 7% APR minus 0.5% (6.5% APR) is still higher than 6% APR with no discount.
Scout rate caps. Unless you have a fixed-rate HELOC, your rate fluctuates with the market. Compare rate caps across lenders to make sure you’re paying the lowest rate possible if rates rise.
Pay off your existing mortgage. Lenders can offer lower rates on HELOCs when they’re the lender in the first lien position. If you have a mortgage, they’re in the second lien position, which increases their risk if the home goes into foreclosure.
HELOC vs. home equity loan
HELOCs and home equity loans differ in how you get your money.
HELOCs offer you a pool of money to draw from whenever you need it, whereas you get all your money in one sum when you take out a home equity loan.
Interest and repayments also differ. A HELOC’s variable rate allows you to make interest-only payments during the draw period, but your repayments after that may vary as your interest rate changes. Home equity loans have fixed rates, which means you’ll have the same rates and payments over the full loan term.
Heather Petty was a personal finance writer at Finder, specializing in home and personal loans. After falling victim to a disreputable mortgage broker when buying her first home, she’s on a mission to help readers avoid similar experiences when managing their own finances. A self-proclaimed word nerd, her writing and analysis has been featured on MSN, Credit.com and MediaFeed, among other top media. Heather previously worked as a technical writer and editor for the casino systems industry and is an internationally published young adult mystery author. She earned a BA in English with a minor in journalism from the University of Nevada, Reno. See full bio
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Heather has written 94 Finder guides across topics including:
Kat Aoki was a personal finance writer at Finder, specializing in consumer and business lending. She’s written thousands of articles to help consumers make better decisions on their home loans, bank accounts, credit cards, cryptocurrency and more. Kat is well versed in working with leading brands in the real estate, mortgage and personal finance industries, and her expertise has been featured on Forbes Advisor, Lifewire and financial comparison sites like iSelect and realestate.com.au. She holds a BS in business administration from California State University, Sacramento and enjoys hiking and yoga in her spare time. See full bio
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Kat has written 184 Finder guides across topics including:
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