SEATTLE HELOC RATES TODAY
Current HELOC rates in
Seattle, WA.
Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.
Current HELOC rates in
Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.
Compare HELOC rates in Seattle.
Key Points
• HELOC rates in Seattle are influenced by the prime rate and local market conditions.
• If you’re aiming for the best rates, a credit score of 700 or more is the target.
• And you’ll want to have at least 15% equity in your home.
• A debt-to-income ratio of 36% or less is a must.
• HELOCs offer financial flexibility and lower interest rates than credit cards.
• The interest you pay on a HELOC for home improvements might be tax-deductible. Check with your tax advisor.
Introduction to HELOC Rates
This article is your go-to guide for understanding how to get equity out of your home in Seattle, WA. We’ll delve into the factors that influence interest rates on a home equity line of credit (HELOC) in your area and equip you with the knowledge to compare the offers you receive. You’ll also gain insight into the benefits and potential risks of a HELOC. Whether you’re eyeing home improvements, using a HELOC for debt consolidation, or covering another significant expense, this guide will empower you to make an informed decision and secure the best terms for your financial goals.
What Is a HELOC?
A HELOC is a revolving credit line that’s secured by the equity in your home (that’s the value of your home, minus what you still owe on your home loan). This means that if you borrow with a HELOC and fail to make payments, a lender could foreclose on your home. To qualify for a HELOC, you typically need to have at least 15% equity in your home, and many lenders will let you borrow up to 90% of your equity. HELOCs have two phases:
The Draw Period
In the HELOC’s initial draw phase, typically 10 years, you can borrow money as you need it, up to whatever credit line your lender has established. Most lenders only require you to pay interest on what you have borrowed during this time. HELOCs have variable interest rates, and a HELOC interest-only calculator is a useful tool at this time.
The Repayment Period
Once you hit the repayment period, you’ll stop borrowing and start making monthly payments of both principal and interest. Again, the interest rate is variable so payments aren’t always predictable. A HELOC monthly payment calculator can help you estimate what you might owe depending on the amount you’ve borrowed and your current rate.
The Origin of HELOC Interest Rates
HELOC interest rates are tied to the prime rate, which is affected by the Federal Reserve’s actions. Lenders then add a margin to the prime rate, which is why HELOC rates can differ — and thus why it’s so important to seek out quotes from multiple lenders. Your credit score, debt-to-income (DTI) ratio, and the amount of equity you have in your home will also influence the interest rate you’re offered.
How Interest Rates Impact HELOC Affordability
The interest rate on your HELOC can make a big difference in your borrowing costs. Even a seemingly small increase in the rate can add up to a lot of extra interest over the life of the HELOC. For example, if you borrowed $100,000 with a HELOC that had a 20-year repayment term at an interest rate of 8.00%, your monthly payment would be $836 and your total interest would be $100,746. But if your interest rate was 9.00%, you would pay $900 each month and your total interest spend would be $115,934. Not a small amount. Of course, HELOCs’ variable rates mean real-world results would vary.
HELOC Interest Rate Trends
Keeping an eye on the prime rate can help you see where HELOC rates in Seattle might be headed. But having a sense of the past history of the prime rate can provide valuable perspective on current rates. Since 2018, the prime rate has fluctuated between 3.25% in 2020 and 8.50% in 2023. If you’re waiting for rates as low as 2020’s, you will be waiting a long while. Fortunately, there are things you can do right now to improve your chance of getting the best available rate, whenever you decide to apply. We’ll cover that below.
| 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
Your initial HELOC interest rate is important, but it’s also good to note that HELOCs, unlike some other financing methods, have variable (also called adjustable) interest rates. A HELOC agreement will spell out how often the rate can adjust, and by how much. It will usually also show the rate cap. If you’re unsure how you feel about variable rates, use an online calculator to compute your interest costs at the low and high end of the range to see if you think you can manage the payments.
Helpful Tools and Calculators
Before you apply for a HELOC, use these tools to help you estimate monthly payment and interest costs.
Run the numbers on your HELOC.
-
Home Equity Loan
CalculatorEnter a few details about your home loan and we’ll provide you your maximum home equity loan amount.
-
HELOC Payment
CalculatorPunch in your HELOC amount and we’ll estimate your monthly payment amount for your HELOC.
-
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 get the most competitive HELOC rates, you’ll need to meet some criteria. First off, make sure you have 15% equity in your home. Subtract what you owe on your mortgage from your home’s estimated value. Then divide the answer by the home value to see your equity percentage. If it’s 15% or more, then proceed to the next steps. With a little planning and by shopping around, you can lock in the best HELOC rates Seattle has to offer.
Improve Your Credit Score
To ensure you’re in the position to secure a good HELOC rate, you’ll want a credit score of 700 or higher. Luckily, you have the power to change your score. Making timely payments and reducing credit card balances are two strategies. Also, be sure to check your credit report for errors and dispute any glitches you find. Keep old credit accounts open (but don’t open new ones). You can get a HELOC with a score as low as 640, but for the great rates, 700 is the goal.
Calculate Your Debt-to-Income Ratio (DTI)
Your DTI ratio is a simple equation: your monthly debt payments divided by your gross monthly income. HELOC lenders generally prefer a DTI under 50%, but for the best interest rates, you’ll want to get your DTI to 36% or less. Reduce what you owe on your debts, increase your income, or — better — do both.
Application Process for a HELOC in Seattle
The process of getting a HELOC is straightforward, especially if you prequalify online. This first step gives you a clear picture of the rates and the potential amount you could access. Once you’re prequalified, you can move on to the full application. This will require some financial and property details, but don’t worry, the lenders will guide you through the process. They’ll review your credit history and assess your home to determine the terms of your HELOC.
Step 1: Run the Numbers
First things first, check your credit score and calculate your DTI ratio. Then, assess your home equity if you haven’t already. Making regular mortgage payments helps build equity. Home improvements that boost the property’s value can increase equity, too.
Step 2: Compare Lenders
Take a look at the rates in Seattle and the general HELOC rates out there. Carefully compare qualification requirements, credit minimums and maximums, any associated fees, and the length of both the draw and repayment periods. Keep an eye out for lenders that offer competitive rates and flexible terms. Reading customer reviews and thoroughly checking lender reputations can also help you make a more informed decision.
Step 3: Submit Your Application
Gather all the necessary paperwork. This includes proof of identification, income verification, and property information. For income verification, you’ll need to provide your most recent pay stubs, W-2 forms, and complete tax returns from the previous year. If you’re self-employed, you may also need to provide a profit-and-loss statement and your tax returns from the past two years. Additionally, you’ll need to provide a homeowners insurance declaration page as part of the property documentation. Once you have everything you need, you can submit your application online, over the phone, or in person.
Step 4: Get an Appraisal
After you’ve filed your application, a lender will require an appraisal. The appraisal determines how much you can borrow and the rates you’ll be offered. A pro will give your home an objective once-over to figure out its value. (Some lenders use a computer program to estimate value; others require a home visit.) The typical cost ranges from $300 to $600. If your home’s value comes in higher than what you owe, your lender might just greenlight that HELOC.
Step 5: Prepare for Closing
Before you can access your HELOC funds, you’ll need to sign your HELOC agreement and pay any necessary fees. Some lenders make funds available within three days following the closing of the HELOC. Prepare for closing by reviewing all documents carefully and understanding the terms and conditions. Make sure you have the required funds to cover any fees.
Closing Costs and Fees
HELOC closing costs are generally more affordable than what you’d encounter with a traditional home purchase or a refinance. The appraisal fee is often the most significant cost. You might also come across an application fee, an origination fee, and administrative fees. Some lenders may even tack on a maintenance fee annually, which could be up to $250, as well as transaction fees for withdrawals.
Recommended: HELOC vs. Home Equity Loan
Tax Benefits and Considerations
Homeowners can deduct HELOC interest on their 2025 taxes if the funds are used to significantly improve their primary residence. If you’re not sure how this applies to you or what will happen in 2026 and beyond — or if you need help itemizing your return to claim the deduction — have a chat with a tax advisor.
Alternatives to HELOCs
There are other ways to tap into your home’s equity, including home equity loans and cash-out refinancing. Or you could always consider taking out an unsecured personal loan. Get the details on these options before you commit to a HELOC:
Home Equity Loan
Home equity loans, unlike HELOCs, provide a lump-sum amount and are paid back at a fixed interest rate. You can usually access up to 85% of the equity you’ve built in your home. Lenders like to see a credit score of 680 or higher, and many prefer 700+ for the best rates. The monthly payments on these loans are predictable. A home equity loan calculator can help you see how much you might be able to borrow with this loan type.
Cash-Out Refinance
A cash-out mortgage refinance is another option for homeowners who want to tap into their equity. In this case, you would refinance your mortgage for more than you currently owe and pocket the difference. Typically, you’ll need a credit score of 620 or higher and a DTI ratio below 43%. If you are thinking about a cash-out refinance vs. home equity line of credit, one difference is that with a refi, you can choose a fixed or variable interest rate.
Personal Loan
A personal loan is typically unsecured and repaid in regular, fixed installments over a period of two to seven years. The key benefit here is that your home is not at risk of foreclosure should you encounter financial challenges. Most lenders look for a credit score of 610 or higher when considering a personal loan application. While the process is relatively swift, do note that the interest rates are often higher than those of HELOCs or home equity loans.
The Takeaway
When considering a HELOC, it’s important to weigh the benefits and risks. HELOCs offer financial flexibility and lower interest rates than credit cards or personal loans, making them a good option for expenses like home renovations or debt consolidation. However, they do have variable rates and carry the risk of foreclosure if you miss payments. Seattle HELOC rates are influenced by the prime rate and your personal financial profile, so it’s always a good idea to shop around for the best rates.
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
How challenging is it to secure a HELOC?
Gaining approval for a HELOC is within reach if you meet the lender’s criteria. Lender requirements vary, but the basic prerequisites are a credit score of at least 640, a debt-to-income ratio below 50%, and a home equity level of 15%. The best interest rates go to those with a credit score of at least 700 and a DTI ratio of 36%. The application process includes submitting financial records and arranging for a home appraisal.
How does a HELOC impact your credit score?
The mere act of 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.
What can you use a HELOC for?
A HELOC is versatile. It can be used for a variety of expenses, from home improvements to debt consolidation. It provides a flexible line of credit, allowing you to withdraw funds as needed during the draw period, typically 10 years, and make interest-only payments. This makes it useful for managing ongoing expenses or large projects that have unpredictable costs.
Do you need an appraisal for a HELOC?
An appraisal is typically required for a HELOC. This step determines your home’s current market value, which in turn helps to calculate the amount of equity you can borrow against. Getting a professional appraisal according to your lender’s instruction is key to securing the best HELOC terms.
SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SOHL-Q225-413
More HELOC resources.
-
What is a Home Equity Line of Credit
-
Different Types of Home Equity Loans
-
HELOC vs Home Equity Loan: How They Compare