Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.
Key Points
• Home equity line of credit interest rates in San Francisco are influenced by the prime rate and economic conditions.
• HELOC rates are adjustable, so monthly payment amounts may fluctuate.
• Homeowners can borrow up to 90% of their home equity with a HELOC.
• HELOCs have two main phases: the draw period and the repayment period.
• Keeping your credit score at 700 or above and your debts low can help you qualify for the best rates.
This article will take a closer look at home equity line of credit (HELOC) rates in San Francisco. We’ll cover the current rates, how they’re determined, and the factors that can influence them. We’ll also discuss the potential benefits and risks of borrowing through a HELOC, so that you can decide if this financial tool is right for you. First things first: Let’s make sure you understand exactly what a home equity line of credit is.
A HELOC is a revolving credit line that uses your home’s equity (the value of your home less the amount you owe on your home loan) as collateral. HELOCs typically have variable interest rates, meaning the interest costs can change over time. Most lenders require you to have at least 15% equity in your home to qualify for a HELOC.
You can typically borrow up to 90% of your equity — which is why it’s so important to keep up to date with payments on your HELOC. (If you don’t make them, the lender could foreclose.) HELOCs have two main periods: the draw period (often 10 years) and the repayment period (typically 10 to 20 years).
During the HELOC’s draw phase, you can borrow funds as you need them, up to your credit limit, and only pay interest on the amount you’ve borrowed. You can use a HELOC interest-only calculator to see what payments might be like during this period.
After a decade, the repayment period typically begins. Now is when you will repay the principal while also still paying interest. A HELOC monthly payment calculator can help you estimate monthly payments as variable interest rates change during repayment.
Recommended: Different Types of Home Equity Lending
Lenders determine HELOC rates based on the prime rate, which is influenced to a great extent by policies of the Federal Reserve. Each lender adds a margin to the prime rate, which explains why different lenders have different HELOC rates (so it pays to shop around). Lenders then consider the credit score, debt-to-income (DTI) ratio, and amount of equity that each individual borrower has in their home before arriving at a specific interest rate to offer a borrower.
The interest rate on your HELOC will play a big role in how affordable it is over the repayment term. For example, if you were to draw $75,000 on a HELOC, a one-percentage-point difference in HELOC interest rate, from 7.50% to 8.50%, during the repayment phase would result in $11,000 in additional interest paid over a 20-year repayment period. HELOCs’ variable interest rates mean it’s hard to estimate payments with total precision, but getting a lower initial rate on your HELOC is certainly a good thing.
As you explore how to get equity out of your home, you’ll probably begin to pay close attention to the prime rate. While it’s no crystal ball, it can give you a sense of where HELOC rates might be headed. Moreover, knowing a bit of the prime rate’s history can give you a sense of whether current interest rates are on the high or low side. So take a look at how rates have changed in recent years.
| 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% |
HELOCs often come with variable (also called adjustable) interest rates that, as the name suggests, can change over the life of the loan. These rates often start lower than fixed rates, but they can rise with market conditions. If you sign on to a HELOC, the agreement you have with the lender will spell out the guardrails of your HELOC rate changes: how often rates can change; how much the rate can deviate in a given time period; and whether there is an overall cap on the rate. If you don’t think you can get comfortable with the idea of a variable rate, there are alternatives to a HELOC described below.
Before you apply for a HELOC, online tools can help you estimate your monthly payments and interest costs, whether you’re in the repayment phase or the interest-only draw phase. Here are a few useful calculators:
Enter a few details about your home loan and we’ll provide you your maximum home equity loan amount.
Punch in your HELOC amount and we’ll estimate your monthly payment amount for your HELOC.
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.
To land the best HELOC rate, you’ll first want to make sure you have at least 15% equity in your home, and ideally more. To do the math, subtract the amount you owe on your mortgage from your home’s estimated value, then divide the answer by your home value to arrive at a percentage of equity. Next take the following two steps:
Keeping your credit score at 700 or above is key to unlocking the best interest rates on HELOCs. To boost your credit score, focus on making timely payments on all your debts and aim to lower credit card balances. These steps can have a big impact on your creditworthiness.
Your debt-to-income (DTI) ratio is an important number. Divide your total monthly debt payments by your gross monthly income. Lenders want to see a DTI below 50%, but for the best interest rate, you’ll want to be below 36%. Pay down debts or increase your income (or both) to get there.
The application process for a HELOC in San Francisco can take approximately 30 to 60 days to complete. Each step is important for securing the best possible terms and rates.
Before you apply for a HELOC, take a moment to check your credit score, calculate your DTI ratio, and estimate your home equity to make sure you at least meet minimum requirements (a 640 credit score, a DTI ratio of 50% or less, and 15% equity).
Now for the real work. When comparing lenders, take a look at the interest rates, qualification requirements, credit limit amounts, fees, and the duration of both the draw and repayment periods. Prequalifying with a lender can help you get a sense of what you might be able to borrow and takes only a few minutes. This is your chance to pinpoint the lender that offers the most bang for your buck.
Now it’s time to get your documents together. You’ll need your ID, proof of income, and the lowdown on the property you’re using as collateral. For income, it’s usually recent pay stubs, W-2s, and tax returns. If you’re self-employed, they might ask for a profit-and-loss statement and a couple years’ worth of tax returns. Oh, and don’t forget your homeowners insurance declaration page as proof of insurance.
An appraisal is a crucial part of the HELOC application process. If your home appraises for more than your existing mortgage balance, the lender may approve you for a HELOC. This professional assessment helps determine the amount of equity you currently have available to borrow against, which is essential for securing the credit line.
Once your application is given the green light, it’s time to gear up for the closing process. This is where you’ll sign all the necessary documents and take care of any fees. Some lenders are pretty speedy at this stage, with funds becoming available within three business days post-closing. Make sure you’re clear on all the HELOC terms before you seal the deal.
HELOC closing costs are generally lower than those for home-buying or refinancing. Appraisal fees, which can fall between $300 and $600, are often the most significant individual expense. If a title search is required, it can cost $100 to $450. You might also encounter application, origination, and administrative costs, as well as the possibility of annual maintenance fees which can be up to $250 per year.
You can deduct the interest on your HELOC on 2025 federal taxes if you’ve used the funds to significantly improve your primary residence (so save receipts documenting how you spend your borrowed funds). To make sure you’re getting the most out of your HELOC, it’s a good idea to chat with a tax advisor, who can also keep you updated on how the HELOC deduction takes shape in future tax years.
Recommended: HELOC vs. Home Equity Loan
There are several other ways to tap into your home’s equity, including a home equity loan or cash-out refinancing. A personal loan is also an option. Consider each of these before you decide on what is right for you:
With a home equity loan, you get a one-time, lump-sum payment. You begin repaying that loan immediately, at a fixed interest rate. As with a HELOC, your home is used as collateral. You can usually tap into up to 85% of your home equity with a home equity loan. A home equity loan calculator can help you see what your borrowing power might be.
A cash-out mortgage refinance lets you refinance your mortgage for more than you owe and pocket the difference in cash. This is good if refinancing doesn’t leave you with a substantially higher interest rate than your original mortgage. When comparing a cash-out refinance vs. a home equity line of credit, it’s notable that the former leaves you with one monthly payment.
A personal loan is typically an unsecured loan and repaid more quickly than a HELOC — in two to seven years. The key perk? Your home is not at risk should you encounter financial difficulties. Personal loans are relatively quick to secure and can be utilized for a wide range of needs. A drawback is that they often come with higher interest rates than HELOCs or home equity loans.
When considering a HELOC, it’s important to weigh the benefits and risks. While HELOCs often offer lower interest rates than some other types of borrowing, and flexibility when compared to lump-sum loans, they do come with the risk of foreclosure. HELOC rates in San Francisco can vary based on your creditworthiness and the lender, so always compare different lenders to find the best fit for your financial situation.
Unlock your home’s value with a home equity line of credit from SoFi, brokered through Spring EQ.
A HELOC can be a smart way to pay for home renovations, education expenses, and debt consolidation. It gives you the power to access funds as you need them during the draw period, making it a flexible option for managing large expenses in increments over time.
During the draw period, most HELOCs would only require that you pay the interest on the portion of the $50,000 you’ve used. But once the draw period ends, your payments will cover both the principal and interest. If you borrowed the full $50,000 and repaid it at 7.00% interest over 20 years, your monthly payment would be $388.
Whether a HELOC is a good idea for you depends on your financial situation and the current HELOC rates in San Francisco. HELOC rates have declined a bit in 2025, making them more attractive. However, variable interest rates can lead to unpredictable payments, and defaulting can result in foreclosure. Consider your long-term financial goals and compare HELOCs with other financing options to make an informed decision.
An appraisal is generally required for a HELOC. This will help determine the current market value of your home and therefore the amount of equity available for you to borrow against. The lender will use this information to set the maximum credit limit and to ensure the loan amount is appropriate. The appraisal process can take a few weeks and may involve a professional visiting your property to evaluate its condition and value.
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