OKLAHOMA HELOC RATES TODAY
Current HELOC rates in
Oklahoma.
Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.
Current HELOC rates in
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Compare HELOC rates in Oklahoma.
Key Points
• HELOCs in Oklahoma are commonly used for home improvements, debt consolidation, education funding, and other large investments.
• A HELOCs has two phases: the draw period and the repayment period.
• To secure the best HELOC rates in Oklahoma, prioritize building your credit score, keeping your job situation stable, and paying down credit card debt.
• HELOC interest rates are based on the prime rate, which fluctuates with economic conditions.
• Alternatives to HELOCs include home equity loans, cash-out refis, and personal loans; each has its own pros and cons.
Introduction to HELOC Rates
Welcome to SoFi’s guide to HELOC interest rates in Oklahoma. Our goal is to help Sooner State homeowners understand all the factors influencing interest rates where you live and how to secure the best deal on a home equity line of credit. We’ll walk you through the application process and share tricks for making a good impression with lenders. Whether you’re looking to fund home improvements, consolidate debt, or make another large investment, this guide will help you navigate the world of HELOCs effectively — and of course, get the best possible deal.
To kick things off, we’ll talk about what is a home equity line of credit?
What Is a HELOC?
If you’re considering how to get equity out of your home, you’ve likely come across the term HELOC before. A HELOC, also known as a home equity line of credit, is a revolving credit line similar to a credit card. The amount you can borrow depends on your equity position: your home’s value minus your mortgage balance. Homeowners can typically borrow up to 90% of their equity, which is determined by an appraisal. HELOCs are a popular way to fund big-ticket items because their interest rates are low compared to personal loans and credit cards.
HELOCs have two phases:
The Draw Period
During the draw period, typically lasting 10 years, you can access funds up to your credit limit. Interest payments are usually required during this period, but principal payments may be optional. If you do pay down the principal, you can borrow that money again. One advantage of a HELOC is that you withdraw from it only what you need, and you pay interest only on the amount you’ve withdrawn.
Using a HELOC interest-only calculator can help you predict your minimum monthly payment during the draw period.
The Repayment Period
HELOC repayment period lasts 10 to 20 years. Borrowing ends, and you repay the principal with interest. However, the variable interest rate will fluctuate, making monthly payments somewhat unpredictable. You can use a HELOC repayment calculator to predict your payments and budget accordingly.
Where Do HELOC Interest Rates Come From?
While you don’t need to become an interest rate expert, it helps to understand the factors involved. HELOC interest rates in Oklahoma are linked to the prime rate, as well as the Fed’s interest rate decisions. With a little luck, you can anticipate rate fluctuations and make better decisions about when to apply for a HELOC.
How Interest Rates Impact HELOC Affordability
Interest rates significantly impact the affordability of a HELOC. When it’s time to repay a $60,000 HELOC, having an interest rate of 8.00% would mean a payment of $502. With a 9.00% rate, your payment jumps to $540. Even more important, over the entire 20-year repayment term, the customer with the 9.00% rate would pay $9,000 more in interest. The more you borrow and the higher the interest rate, the larger these numbers get. This is why it pays to research the best HELOC rates in Oklahoma.
HELOC Interest Rate Trends
The movement of the prime interest rate serves as an indicator of future HELOC rate trends. Since 2018, the prime rate has undergone substantial fluctuations, ranging from a low of 3.25% in 2020 to a high of 8.50% in 2023. The graphic below shows a longer history of the average prime rate over the last 50 years.
Historical Prime Interest Rate
| 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
Historical U.S. Prime Rates
Factors Influencing HELOC Rates
Not everyone gets the prime rate. Other metrics factor into the interest rate that you’re offered, such as your home equity position, credit score, income, and combined loan-to-value (CLTV) ratio.
Home Equity
Having substantial equity in your home makes you appear less risky to lenders, potentially leading to lower interest rates. Homeowners typically need at least 15% equity in their property to qualify for a HELOC. Using a home equity loan calculator can help you determine your equity.
Credit Score
Maintaining a credit score of 680 or higher is needed to qualify for a HELOC. But a credit score of 700 or above will secure you a better interest rate.
Stable Income
Lenders assess your overall income to make an informed judgment regarding your ability to repay the HELOC. A consistent and stable income serves as a strong indicator of a lower risk of default.
Loan-to-Value Ratio
Lenders often require a combined loan-to-value ratio of 90% or less. If your home’s value is $500,000, your mortgage balance is $300,000, and your HELOC balance is $100,000, your combined LTV ratio is 80%: $300,000 + $100,000 / $500,000.
Variable vs Fixed Interest Rates
HELOCs feature variable interest rates, which are subject to change during the repayment term. While variable rates often start lower than fixed rates, they can adjust either upward or downward in response to market conditions.
Tools & Calculators
Financial calculators are designed to assist you in accurately estimating your payments and gaining a clear understanding of the financial implications associated with various financing options. Here are three of our favorites.
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 qualify for the most favorable HELOC rates available in the state of Oklahoma, it is recommended that you prioritize building your credit score. The factors below collectively exert a substantial influence on the interest rates you’re offered.
Cultivate Your Credit Score
Maintaining timely bill payments and reducing credit card balances can significantly boost your credit score. A higher credit score makes you a more attractive candidate for a home equity line of credit, as it demonstrates your responsible financial behavior and ability to manage debt effectively.
Assess Your Home Equity
The first step when you’re considering different types of home equity loans and lines of credit is to assess your equity stake. Subtract your mortgage balance from your home’s value, then divide the result by the home value to get a percentage. While lenders will use an in-person appraisal to pinpoint your home value, you can use an online estimate from a real estate site.
Regular mortgage payments help in building home equity over time. Home equity can also be enhanced through renovations that boost the property’s value. Increased home equity can lead to better terms and higher amounts when applying for a HELOC.
Calculate Your Debt-to-Income Ratio (DTI)
Your DTI ratio is how much you owe in monthly debt payments (student loans, car loan, etc) divided by your gross monthly income. Home equity lenders generally look for a DTI that’s below 36%, but the lower your DTI, the better. A lower DTI can help you secure more favorable terms on your HELOC.
Application Process for a HELOC in Oklahoma
The application process for a HELOC in Oklahoma involves several steps, including assessing your financial health, comparing rates, preparing documentation, and undergoing a home appraisal.
Step 1. Run the Numbers
Check your credit score, calculate your DTI, and get a good estimate of your home equity before you apply for a HELOC. Some lenders offer online prequalification tools to streamline this process.
Step 2. Compare Lenders
See what offers you might qualify for when it comes to interest rates, but also compare their qualification requirements, credit line minimums and maximums, fees, and the length of the draw and repayment periods they’re offering.
Step 3: Gather Your Documents
When you’re ready to apply for a HELOC, make sure you have all the necessary documents in order. This typically includes proof of income, a detailed employment history, credit reports, and documentation verifying your home’s value and insurance coverage. This can help expedite the application process.
Step 4: Submit Your Application
Submitting your HELOC application takes place online, by phone, or in person. Ensure all information is accurate and complete to avoid any delays.
Step 5: Get an Appraisal
A home appraisal is a pivotal step in the HELOC process. If the valuation of your home surpasses the outstanding balance of your mortgage, there’s a strong likelihood that the lender will grant approval for your HELOC.
Step 6: Prepare for Closing
Before accessing your HELOC funds, you must sign documents and pay necessary fees. It is possible for some lenders to make funds available within a three-day time frame subsequent to the closing of the home equity line of credit.
Tax Benefits and Considerations
Homeowners may be able to deduct their HELOC interest if the funds are used for buying, building, or significantly improving their primary residence. Interest deductions are limited to the first $375,000 of the principal for individual taxpayers ($750,000 for married couples filing jointly). Consulting a tax advisor can help you navigate the specific tax implications and confirm eligibility for deductions.
Closing Costs and Fees
HELOC closing costs are usually lower than traditional home-buying or cash-out refinance costs. The appraisal fee, ranging from $150 to $600, is typically the highest expense. Other fees may include application, origination, and administrative charges. An annual maintenance fee and potential transaction or inactivity fees may also apply. Some lenders offer reduced or waived closing costs in exchange for a higher interest rate.
Alternatives to HELOCs
Just as there are different kinds of home loans when you purchase a residence, you have different options for leveraging your home equity. Each has distinct advantages, depending on your financial situation.
Home Equity Loan
What is a home equity loan? Unlike a HELOC, you receive a lump sum amount that you immediately pay back in regularly monthly installments. Because the interest rate is fixed, the payment never changes over the life of the loan — making budgeting a little easier.
If this sounds more your speed, check out our comparison of the HELOC vs Home Equity Loans.
Cash-Out Refinance
A type of mortgage refinance, a cash-out refi allows homeowners to refinance their mortgage for more than they owe and take the difference in cash. This can be helpful for those who need a large sum of money up front. But if mortgage rates are higher now than on your existing mortgage, this might not be the right choice for you.
Our Cash-Out Refinance vs Home Equity Line of Credit guide can help you decide.
Personal Loan
A personal loan is a flexible, typically unsecured loan that you pay back in regular, fixed payments over a term of 2-7 years. Personal loans do not require collateral, unlike HELOCs, but for that reason their interest rates are typically higher.
Credit Cards
Credit cards usually come with much higher interest rates than HELOCs, which can make them more expensive if you carry a large balance from month to month. While credit cards offer flexibility for smaller purchases, HELOCs are better suited for larger expenses such as home improvements or debt consolidation.
The Takeaway
When searching for the best HELOC rates in Oklahoma, it’s important to compare multiple lenders and understand the terms and conditions of each offer. HELOCs can be a valuable financial tool for homeowners looking to leverage their home equity, but it’s essential to manage them responsibly to avoid financial strain. Building your credit score and paying down credit card debt can help borrowers secure the lowest available interest rate, which will save them considerable money over the long term.
SoFi now offers flexible HELOCs. Our HELOC options allow you to access up to 90% of your home’s value, or $500,000, at competitively low rates. And the application process is quick and convenient.
FAQ
What is the monthly payment on a $50,000 HELOC?
Let’s assume you draw the full amount and make interest-only payments during the draw period. With an 8.00% interest rate and a 10-year term, your monthly payment will be about $607. An 8.00% interest rate over a 20-year term would cost $418 per month, but you’ll pay more interest in the long run.
Is a HELOC a smart move for you?
A home equity line of credit (HELOC) can be a convenient financial tool for homeowners with a steady income, strong credit, and ample home equity. However, because a HELOC is secured by your home, if you default you could face foreclosure.
What is the monthly payment on a $100,000 HELOC?
The monthly payment on a $100,000 home equity line of credit is determined by the interest rate and term. If you draw the full amount, have an 8.50% interest rate, and repay what you borrowed (plus interest) over a 20-year term, your monthly payment should be about $868.
What are the benefits of a HELOC?
The benefits of a HELOC include flexible access to funds, competitive interest rates, and potential tax advantages. A HELOC can provide a financial safety net for major expenses, but it’s important to use it responsibly.
Do you need an appraisal for a HELOC?
Yes, you typically need an appraisal for a HELOC. The appraisal helps determine the value of your home, which is a key factor in calculating your borrowing limit.
What might prevent you from getting a home equity loan?
Several factors can disqualify you from getting a home equity loan, including insufficient home equity (below 15%), a low credit score (below 680), or a high debt-to-income ratio (over 50%).
How difficult is it to get a HELOC?
The difficulty of getting a HELOC depends on your financial situation and the lender’s requirements. Factors such as your credit score, home equity, and debt-to-income ratio play a significant role in qualifying for a HELOC. It’s important to compare lenders and understand their qualification criteria when applying.
Does HELOC affect credit score?
A HELOC may affect your credit score. Applying can cause a hard inquiry, lowering your score a bit. Using a large portion of available credit can increase credit utilization, also dinging your score. However, managing a HELOC responsibly and making timely payments can help borrowers maintain a good credit score.
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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