BOSTON HELOC RATES TODAY
Current HELOC rates in
Boston, MA.
Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.
Current HELOC rates in
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Key Point
• Home equity line of credit rates in Boston are influenced by the prime rate and market conditions.
• HELOCs offer a revolving line of credit, with interest charged only on the amount you actually use.
• To secure the best rates, a credit score of 700 or higher and a debt-to-income ratio under 36% are goals to aim for.
• You can use your HELOC for a variety of purposes, from home improvements to debt consolidation to major expenses.
• Understanding the draw and repayment periods is important for managing HELOC payments effectively.
Introduction to HELOC Rates
Welcome to your comprehensive guide home equity line of credit rates in Boston. Whether you’re a seasoned borrower or just starting out on this journey, this guide is designed to help you understand the current market conditions and how to qualify for the best rates. You’ll learn about the factors that influence HELOC rates, the benefits and risks of HELOCs, and how to use online tools to estimate monthly payments. Whether you’re planning a renovation or need funds for other financial goals, this guide will equip you with the knowledge to make informed decisions about accessing your home equity.
What Exactly Is a HELOC?
A HELOC is a financial tool that leverages your home equity as collateral. Your equity is the difference between the current value of your home and the balance of your home loan. To qualify, homeowners typically need to have at least 15% equity. With a HELOC, you can borrow up to 90% of that equity, although it’s important to note that if you fail to repay what you owe, the lender could foreclose on your home. This credit line has two phases, with a different payment structure in each phase:
The Draw Period
This phase can last up to 10 years and is an important distinction between a HELOC vs. a home equity loan. During the draw period, you only have to pay interest on the amount of the credit line you’ve borrowed. (With a home equity loan, you get a lump sum and start repaying principal plus interest immediately.) A HELOC interest-only calculator lets you see what you might owe.
The Repayment Period
After the draw period comes the 10- to 20-year repayment period when you stop borrowing and start repaying what you owe, plus interest. This is when a HELOC monthly payment calculator might be useful, because HELOCs have variable interest rates that can change with market conditions. This means your monthly payment won’t always be the same.
The Origin of HELOC Interest Rates
Lenders set HELOC rates based on the prime rate, which is influenced by Federal Reserve policies. Each lender adds a margin to the prime rate to determine the final HELOC rate. The margin can vary from one lender to the next, which is why rates can differ — and why it’s so important to shop around and get rate quotes from multiple lenders. Lenders also consider factors such as your credit score, debt-to-income ratio (DTI), income, and the amount of equity in your home when they determine the rate you’ll be offered.
How Interest Rates Impact HELOC Affordability
The interest rate on your HELOC plays a major role in its affordability. Even a small difference in the rate can have a big impact on how much interest you’ll pay, so it makes sense to try to get the lowest possible rate from the outset of your HELOC. Let’s say you borrowed $100,000 with a HELOC and entered your 20-year repayment phase with an interest rate of 7.00%. You would pay a total of $86,072 in interest if the rate held steady. But if you instead had a rate of 8.00%, you would pay $100,746 — more than $14,000 in additional interest charges. HELOCs’ variable rates mean your exact results may differ, but a lower interest rate is generally a better one.
HELOC Interest Rate Trends
While no one can tell you with certainty where interest rates are headed, keeping an eye on the prime interest rate can offer a glimpse into the future of HELOC rates in Boston. The prime rate hit a low of 3.25% in 2020 and a recent high of 8.50% in 2023. Having a sense of this range and the history of the rate can give you a sense of where variable rates might go as well and hint at whether the rates you’re currently seeing are relatively low or high.
| Date | U.S. Rate |
|---|---|
| 9/19/2024 | 8.00% |
| 7/27/2023 | 8.50% |
| 5/4/2023 | 8.25% |
| 3/23/2023 | 8.00% |
| 2/2/2023 | 7.75% |
| 12/15/2022 | 7.50% |
| 11/3/2022 | 7.00% |
| 9/22/2022 | 6.25% |
| 7/28/2022 | 5.50% |
| 6/16/2022 | 4.75% |
| 5/5/2022 | 4.00% |
| 3/17/2022 | 3.50% |
| 3/16/2020 | 3.25% |
| 3/4/2020 | 4.25% |
| 10/31/2019 | 4.75% |
| 9/19/2019 | 5.00% |
| 8/1/2019 | 5.25% |
| 12/20/2018 | 5.5% |
| 9/27/2018 | 5.25% |
Source: U.S. Federal Reserve
Variable vs. Fixed Interest Rates
HELOCs usually come with adjustable (also called variable) interest rates, which means they can change over the life of the loan. This can lead to some uncertainty about what your monthly payment amounts might be. The agreement you sign with a lender will spell out how often the rate can change and put some restrictions around how much it can change. If you can get comfortable with this variability, a HELOC can be a smart way to borrow, especially when you don’t know exactly how much money you will need.
Helpful Tools and Calculators
Before you apply for a HELOC, it’s wise to take advantage of online tools to see what monthly payments and interest costs might look like. Here are three useful calculators for home owners interested in borrowing against their equity.
Run the numbers on your HELOC.
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Home Equity Loan Calculator
Enter a few details about your home loan and we’ll provide you your maximum home equity loan amount.
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HELOC Payment Calculator
Punch in your HELOC amount and we’ll estimate your monthly payment amount for your HELOC.
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HELOC Interest Only Calculator
Use SoFI’s HELOC interest calculator to estimate how much monthly interest you’ll pay .
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
How to Qualify for a Competitive HELOC Rate
To secure a favorable HELOC rate, first make sure you have at least 15% equity in your home — and ideally more. Subtract your mortgage balance from your home’s estimated value, then divide the answer by the home value to get your equity percentage. Then move on to sharpening your credit score and DTI ratio.
Improve Your Credit Score
Keeping your credit score at 700 or above is a smart move if you’re aiming for the best HELOC rates. You have the power to boost your score by making timely payments and chipping away at credit card balances. It’s also wise to review your credit report for any errors and dispute them to set the record straight. And here’s a pro tip: Don’t be too quick to close those old credit accounts — they can actually work in your favor.
Calculate Your Debt-to-Income Ratio (DTI)
Your DTI ratio is a simple concept: It’s the sum of your monthly debt payments divided by your gross monthly income. Most HELOC lenders prefer a DTI under 50%, but for the most attractive HELOC rates, you’ll want to nudge your rate below 36%. You can do this by paying down debts, increasing your income, or both.
Application Process for a HELOC in Boston
Many lenders offer the convenience of prequalification for a HELOC online, making the process a breeze. This preliminary step can provide you with a glimpse of the HELOC rates in Boston that you might be eligible for, as well as the amount of equity you can tap into. Once you’ve decided that you want to proceed to a full application, you can follow these steps:
Step 1: Run the Numbers
Check that your equity level, credit score, and DTI ratio meet the minimums a lender will look for. That’s 15% equity, a credit score of at least 640, and a DTI of 50% or less.
Step 2: Compare Lenders
Compare different lenders to find the best HELOC rate you can get in Boston. Don’t just examine interest rates. Narrow the field based on rates, but also scrutinize qualification requirements, minimums and maximums, fees, and the length of the draw and repayment periods. Each lender has unique terms and conditions, so read the fine print to understand the full scope of what you’d be signing up for.
Step 3: Submit Your Application
You’ll need to gather your ID, proof of income (pay stubs, W-2, tax documents), and insurance policy information for the property you’re using as collateral. If you’re self-employed, a lender might ask for a profit-and-loss statement and a couple years’ worth of tax returns. Once you’ve got everything together, you can apply online, over the phone, or in person.
Step 4: Get an Appraisal
After you submit an application and solidify your choice of lender, you’ll likely need an appraisal. Work with the lender to ensure you get the appraisal and documentation the lender requires. If your home is appraised for more than what you owe — to the point that you hit that 15% equity target — you’ll have cleared a bar necessary for a HELOC.
Step 5: Prepare for Closing
If you’re approved for a HELOC, you’ll need to sign the HELOC documents and pay any associated fees. Most lenders will make the funds available within three business days of the HELOC closing. Before you sign on the dotted line, be sure you understand all the terms and conditions. This is an important step to avoid any surprises and to make sure you’re prepared to use your HELOC.
Closing Costs and Fees
The good news is, HELOC closing costs are generally less than what you’d face with a home purchase or a refinance. The most significant expense is often the appraisal, which can run from $300 to $600. A title search might set you back $100 to $450, with additional costs for application, loan origination, and administrative fees. Some lenders may also charge annual maintenance fees, which could reach $250, as well as transaction, inactivity, or early termination fees.
Tax Benefits and Considerations
Homeowners can deduct HELOC interest on their 2025 federal taxes if the borrowed funds are used to improve the home used as collateral. You’ll have to itemize on your return to claim this deduction, and you may want to talk to a tax advisor to make sure you qualify for this deduction, and to keep tabs on how tax policies change in 2026 and beyond.
Recommended: Different Types of Home Equity Lending
Alternatives to HELOCs
There are other ways besides a HELOC to get equity out of your home, and it’s worth considering these before you sign on to a line of credit. You might also consider a personal loan for your needs. Here’s a look at how they differ:
Home Equity Loan
With a home equity loan, you get a one-time lump-sum loan and start repaying it immediately at a fixed interest rate. You can usually borrow up to 85% of your equity. Lenders often look for a credit score of 680, with many preferring 700-plus, in order for borrowers to qualify. If you’re someone who likes a fixed interest rate and a predictable payment amount, this might be a good fit for you. You can use a home equity loan calculator to see how much you might borrow.
Cash-Out Refinance
A cash-out mortgage refinance lets you refinance for more than you already owe and take the difference in cash. It can be a wise move if the interest rate on a new mortgage would be better than your current rate. Things to consider with a cash-out refinance vs. a home equity line of credit: With a refinance you’d need a credit score of 620 or higher and a DTI ratio under 43%. A refinance also allows you to select a fixed or variable interest rate.
Personal Loan
A personal loan is typically an unsecured loan that you repay in regular, fixed installments over two to seven years. The key advantage is that your home is not at risk of foreclosure should you be unable to make your loan payments. Most lenders look for a credit score of 610 or higher when considering a personal loan application. While these loans are relatively quick to secure, the interest rates may be higher compared to HELOCs or home equity loans.
The Takeaway
When you’re considering a HELOC, there’s the sobering thought of your home being at stake if you can’t repay what you borrow. However, HELOCs tend to have lower interest rates than unsecured loans. And if you have a history of borrowing responsibly, a line of credit is a smart way to solve your cash needs because you’ll only pay interest on the funds you borrow. Just make sure you scout around and compare offers from multiple lenders to obtain the most favorable rate and terms.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Unlock your home’s value with a home equity line of credit from SoFi, brokered through Spring EQ.
FAQ
Is a HELOC a good idea?
As with any financial decision, you have to consider your individual circumstances and aspirations. If you need to borrow a large sum of money but you don’t need it all at once, and if you are sure you can meet the monthly payments required to repay what you borrow, a HELOC is a good way to finance a big project such as a renovation or educational expense. Interest rates on HELOCs tend to be lower than the rates on personal loans.
What’s the monthly payment on a $100,000 HELOC?
The monthly payment on a $100,000 HELOC can vary greatly depending on the interest rate and the repayment period. During the draw period, you may only need to pay interest on the amount you’ve borrowed, which isn’t necessarily going to be the full $100,000. If you did use the entire credit line of $100,000, your interest rate for repayment would likely be a variable one. But at an average of 8.00% and a repayment term of 20 years, you would pay $836 per month.
Do you need an appraisal for a HELOC?
Most homeowners will need an appraisal in order to qualify for a HELOC. The appraisal helps determine the current market value of your home, which is important for calculating how much credit you can access as well as the interest rate you’ll receive. Appraisal fees are often the most significant expense in the closing costs for a HELOC, but clearing the appraisal stage means you’re in the homestretch of the HELOC process.
How does a HELOC affect your credit score?
Opening a HELOC can cause a slight dip in your credit score due to the necessary hard credit inquiry by a prospective lender. But use your HELOC responsibly — make timely payments and keep balances in check — and you may actually see an improvement in your score. On the flip side, missing payments or maxing out your HELOC can be detrimental.
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More HELOC resources.
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What is a Home Equity Line of Credit
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Different Types of Home Equity Loans
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HELOC vs Home Equity Loan: How They Compare