Now may not be the right time to buy a house, but with property values continuing to rise, this may be the perfect time to tap into your home’s equity for the money you need. At least, that’s what responders to our Consumer Confidence Index believe. Only 26% say that now is a good time to buy a house while the vast majority agree that it’s not, but 56% expect home prices to rise in their area. And as home values rise, so does your home’s equity.
With so many lenders competing for your business, borrowers are in an ideal position to find a competitive fixed rate on a home equity loan — and in many cases, you may not have to pay closing costs or origination fees.
What’s the current average home equity rate?
Right now, interest rates on home equity loans are fluctuating between 7.84% to 9.84%, according to Bankrate, with an average rate of 8.54% as of August 2023. However, the rate your lender offers depends primarily on your credit score as well as the loan amount and term length.
LendingTree is an online loan marketplace that partners with a range of home loan lenders across the U.S. Fill out the application and if you qualify, LendingTree matches you with lenders willing to work with your credit score and loan preferences.
We chose Lending Tree for its network of over 500 lenders, ensuring you'll get a variety of offers suited to your financing needs. LendingTree claims you may get a lower rate since lenders are competing for your business. But with your information out to such a wide pool, you may receive a large number of emails and phone calls, even after you've made your selection.
Loan Amount
$10,000 to $360,000
APR
Starting at 6.88%
Min. Credit Score
620
LendingTree is an online loan marketplace that partners with a range of home loan lenders across the U.S. Fill out the application and if you qualify, LendingTree matches you with lenders willing to work with your credit score and loan preferences.
We chose Lending Tree for its network of over 500 lenders, ensuring you'll get a variety of offers suited to your financing needs. LendingTree claims you may get a lower rate since lenders are competing for your business. But with your information out to such a wide pool, you may receive a large number of emails and phone calls, even after you've made your selection.
We chose this Midwest- and Southeast-based lender because it doesn't charge closing costs on its home equity loans and offers fixed rates that start at 6.25% APR with autopay as of August 2023 — lower than what many other lenders are currently charging.
With Regions, you can borrow between $15,000 and $250,000 for 7, 10, 15 and 20 years with no prepayment penalty. But customer reviews for the bank aren't the greatest.
Loan Amount
Not stated
APR
HELOC: Introductory 0.99% APR for first 6 months, then 3.75% to 18%. Home equity loans: 6.25% to 13.875%
We chose this Midwest- and Southeast-based lender because it doesn't charge closing costs on its home equity loans and offers fixed rates that start at 6.25% APR with autopay as of August 2023 — lower than what many other lenders are currently charging.
With Regions, you can borrow between $15,000 and $250,000 for 7, 10, 15 and 20 years with no prepayment penalty. But customer reviews for the bank aren't the greatest.
Pros
0.25% autopay discount
No closing costs or origination fees
Offers a full suite of banking products
Cons
Negative customer reviews
Only available in limited states
Maximum borrowing limit is $250,000
Loan Amount
Not stated
APR
HELOC: Introductory 0.99% APR for first 6 months, then 3.75% to 18%. Home equity loans: 6.25% to 13.875%
State availability
Only available in: AL, AR, FL, GA, IA, IL, IN, KY, LA, MO, MS, NC, SC, TN, TX
Loan Amount
Not stated
APR
HELOC: Introductory 0.99% APR for first 6 months, then 3.75% to 18%. Home equity loans: 6.25% to 13.875%
We chose U.S. Bank because it considers the borrower's full credit history rather than their FICO score only when underwriting loans. Its rates start higher than lenders like Regions Bank, and it only offers two terms on its home equity loans: 10 and 15 years. But its greater flexibility could be helpful if you're rebuilding your credit, and it offers higher borrowing amounts than other lenders.
Loan Amount
Home equity loan: $15,000 to $750,000 (up to $1 million in California); HELOC: $15,000 to $750,000 ($100,000 maximum in NY)
APR
8.95% to 13.10%
Min. Credit Score
660
We chose U.S. Bank because it considers the borrower's full credit history rather than their FICO score only when underwriting loans. Its rates start higher than lenders like Regions Bank, and it only offers two terms on its home equity loans: 10 and 15 years. But its greater flexibility could be helpful if you're rebuilding your credit, and it offers higher borrowing amounts than other lenders.
Pros
Cons
Not the most competitive rates
Prepayment penalty if you pay off the loan within 30 months
Maximum 15-year term length
Loan Amount
Home equity loan: $15,000 to $750,000 (up to $1 million in California); HELOC: $15,000 to $750,000 ($100,000 maximum in NY)
APR
8.95% to 13.10%
Min. Credit Score
660
State availability
Not available in: DE, SC, TX
NMLS #
402761
Loan Amount
Home equity loan: $15,000 to $750,000 (up to $1 million in California); HELOC: $15,000 to $750,000 ($100,000 maximum in NY)
If you're a homeowner who's affiliated with the armed forces, Navy Federal has some benefits you might not find elsewhere. In addition to competitive rates, Navy Federal Credit Union offers a maximum combined loan-to-value ratio (CLTV) of 100%, which is uncommon with home equity loans. With Navy Federal you can borrow up to $500,000 and pay your loan back over 5, 10, 15, or 20 years.
Loan Amount
Up to $500,000
APR
6.640% to 18%
If you're a homeowner who's affiliated with the armed forces, Navy Federal has some benefits you might not find elsewhere. In addition to competitive rates, Navy Federal Credit Union offers a maximum combined loan-to-value ratio (CLTV) of 100%, which is uncommon with home equity loans. With Navy Federal you can borrow up to $500,000 and pay your loan back over 5, 10, 15, or 20 years.
Pros
Competitive interest rates
No origination or application fees
No closing costs on loans over $250,000
Cons
Closing costs on loans under $250,000
Must be affiliated with the military to qualify
Loans under $25,000 are subject to a 1% rate increase
If you're looking for a lender that has technology to make it easier and faster to get a home equity loan, Spring EQ gets high marks from customers for its reduced paperwork application process.
The lender offers home equity loans up to $500,000 and lends to eligible borrowers at a combined LTV of 97.5% — higher than many other lenders — with repayment terms ranging from five to 30 years.
Loan Amount
Up to $500,000
APR
Not stated
Min. Credit Score
640
If you're looking for a lender that has technology to make it easier and faster to get a home equity loan, Spring EQ gets high marks from customers for its reduced paperwork application process.
The lender offers home equity loans up to $500,000 and lends to eligible borrowers at a combined LTV of 97.5% — higher than many other lenders — with repayment terms ranging from five to 30 years.
Pros
Get prequalified online with no hard credit check
Digital application process may speed up loan processing
Buy points to lower your rate
Cons
Rates aren't the most competitive
Online payments may not be available
Not available in all states
Loan Amount
Up to $500,000
APR
Not stated
Min. Credit Score
640
Loan Amount
Up to $500,000
APR
Not stated
Min. Credit Score
640
Methodology: How we choose the best home equity loan lenders
Finder’s lending experts analyze more than 25 home equity loan lenders to choose and update our top picks.
Each lender is weighed across 10 key metrics:
Origination fees
Loan amounts
Credit limits
Minimum and maximum APR
Discounts
Closing costs
Customer reviews
Requirements
Turnaround
Regional footprint
We regularly update our best picks as home equity products change, disappear or emerge in the market and to reflect the most competitive products available.
Compare current home equity loan rates
Use our tool to get personalized estimated rates from top lenders based on your location and financial details. Select Home Equity Loan, enter your ZIP code, credit score and information about your current home to see your personalized rates.
Searching for the best rates...
How to get the best home equity rate
The interest rate you get is largely determined by your FICO score, the loan term length and the amount borrowed.
Here are four tips to getting the best rate on your home equity loan:
Increase your credit score. The best home equity loan rates are available for borrowers with FICO scores of 740 and up and debt-to-income ratios of under 43%. The higher your credit score and the lower your DTI, the better the rate you can potentially get.
Choose a shorter loan term. Some lenders offer more competitive rates on short-term loans like seven or 10 years.
Choose a higher loan amount. You can often get a better rate if you borrow a larger amount, but this only makes sense if you need it or you can pay the loan off early without penalty. If you’d prefer a revolving credit line or varying amounts, a HELOC may be more suitable.
Compare multiple lenders. Every lender has different offerings, and simply comparing loans could mean significant savings. Remember to add any closing costs and origination fees into your calculation, as these affect your APR.
4 more factors to consider
When choosing a home equity loan, consider factors beyond just the advertised interest rate. Here are a 4 things to keep in mind:
APR. The APR is the annualized interest rate you pay once all costs and fees are factored into a loan. If your loan has closing costs or origination fees, this pushes the APR up.
Prepayment penalties. Ask if the loan carries any prepayment penalties in case you want to pay your loan off early and save on interest.
Term length. The longer the term repayment period you choose, the lower your monthly payment will be, but the more interest you’ll pay over the loan’s life.
Relationship discounts. You can often get 0.25% or 0.50% off your rate If you set up autopay on your loan or open a checking account, but this doesn’t guarantee you’re getting the lowest rate.
Is a home equity loan the best option?
A home equity loan isn’t the only way to tap into your home’s equity. Here are some more options for accessing cash:
Home equity line of credit (HELOC). This is a revolving line of credit with a variable interest rate that you draw from for 10 years making interest-only payments, and repay over 20 years. Compare top HELOC lenders.
Cash-out refinance. A cash-out refinance mortgage replaces your current mortgage with one for a greater amount, so you can “cash out” the difference. Learn more about how cash-out refis work.
Personal loan. Personal loans typically offer borrowing amounts from $500 to $100,000 and have no collateral requirements — but interest rates will likely be higher than for a home equity loan. Compare some of the best personal loans.
Bottom line
The home equity loan market is competitive, so shop around and compare multiple lenders to get the best deal on rates, closing costs and fees. But because you’re taking on more debt with this type of product, understand the risks and benefits of home equity loans. To learn more, see our guide to home equity loans.
Katia Iervasi is a lead writer and spokesperson at NerdWallet and a former editor at Finder, specializing in insurance. Her writing and analysis on life, disability and health insurance has been featured in The Washington Post, Forbes, Yahoo, Entrepreneur, Best Company and FT Advisor. She holds a BA in communication from Australia's Griffith University. See full bio
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Finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which Finder receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. Finder compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
