WISCONSIN HELOC RATES TODAY
Current HELOC rates in
Wisconsin.
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 Wisconsin.
Key Points
• A home equity line of credit (HELOC) can help you find the money to pay for home improvements or education expenses, or to consolidate debt.
• When you compare HELOC lenders in Wisconsin, consider interest rates and terms, fees, credit line minimums and limits, and the lender’s reputation.
• HELOC rates in Wisconsin are influenced by the prime interest rate and other economic variables.
• Your own financial standing, such as your home equity position, credit score, income, and loan-to-value ratio, may significantly impact the HELOC rates lenders in Wisconsin offer you.
• To qualify for the most favorable HELOC rates, you can prioritize building your credit score, maintaining a steady flow of income, and working toward a low debt-to-income ratio.
Introduction to HELOC Rates
if you’re looking to learn how to get equity out of your home with a HELOC, this guide will accelerate and inform your process of applying, plus help you get a competitive interest rate. You’ll learn about the key factors that influence HELOC rates in Wisconsin. You’ll also find out how to use this information so you can put your best financial foot forward and make informed decisions when you convert your home equity into cash. Let’s start with the basics:
What Is a HELOC?
HELOCs enable homeowners to borrow against their home equity. You can borrow up to 90% of your home’s value, less what you owe on your mortgage. But a HELOC works somewhat like a credit card, meaning that you don’t have to borrow the entire amount all at once, and that is one difference in a HELOC vs. a home equity loan. You can borrow the money as you need it, in increments. But because a HELOC is secured by your home, it usually offers a better interest rate than a credit card or a personal loan.
HELOCs have two separate phases: a draw period followed by a repayment period. It’s important to understand the difference between the two.
The Draw Period
During the draw period (usually 10 years), you can access your HELOC funds up to your credit limit, make payments to pay down your balance, and borrow the money all over again. Borrowers are usually required to make interest payments during the draw period, but paying down the principal may be optional. This gives you control over your finances during the HELOC draw period.
The Repayment Period
The repayment period lasts 10–20 years, and during it, you must repay the HELOC principal with interest. A HELOC repayment calculator can help you understand what your monthly payments and overall interest paid could look like. Since HELOCs carry the risk of foreclosure if borrowers default, it’s important to understand what payments you’ll be required to make, and to research HELOC rates in Wisconsin to ensure you get a competitive deal.
Where Do HELOC Interest Rates Come From?
HELOC rates are influenced by lenders’ prime rate, the benchmark interest rate for their most creditworthy customers. Additional factors influence what individual applicants are offered. We’ll cover those later, but first, you need to understand how big of a deal an interest rate can be.
How Interest Rates Impact HELOC Affordability
Your interest rate makes a big difference when you borrow with a HELOC. If you spend a little time with a HELOC repayment calculator, it can help you understand the influence that rate will have on affordability. Here’s a look at three possible HELOC credit limits with different interest rates and terms:
| Loan Amount | Loan Term | Interest Rate | Monthly Payment | Total Interest Paid |
|---|---|---|---|---|
| $100,000 | 20 years | 8.00% | $836 | $100,746 |
| 7.00% | $775 | $86,072 | ||
| 10 years | 8.00% | $1,213 | $45,593 | |
| 7.00% | $1,161 | $39,330 | ||
| $50,000 | 20 years | 8.00% | $418 | $50,373 |
| 7.00% | $388 | $43,036 | ||
| 10 years | 8.00% | $607 | $22,797 | |
| 7.00% | $581 | $19,665 | ||
| $25,000 | 20 years | 8.00% | $209 | $25,186 |
| 7.00% | $194 | $21,518 | ||
| 10 years | 8.00% | $303 | $11,398 | |
| 7.00% | $290 | $9,833 |
HELOC Interest Rate Trends
Looking at a history of the average prime rate can give you insight into current HELOC rate trends. As you can see in the chart below, the prime rate has fluctuated notably in the last few years, reaching a low of 3.25% in 2020 and a high of 8.50% in 2023. If you’re working on understanding what is a home equity line of credit and wondering if a 4.00% rate might be in your future, this chart will provide valuable perspective (such low rates are a rarity).
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
The prime rate is important, but it isn’t the only thing that influences HELOC interest rates in Wisconsin. Factors that are specific to individual borrowers also matter. Understanding them can help you secure the most favorable rates for your line of credit.
Home Equity
If you have a sizable amount of equity in your residential property, it makes you an attractive prospect for lenders and may score you a more attractive interest rate. Homeowners typically need a minimum of 15% equity to qualify for a HELOC.
Credit Score
A credit score of 680 or higher is a great thing when it comes to securing a HELOC. Many lenders look for borrowers with credit scores over 700.
Stable Income
Lenders look hard at the money you earn. They are going to carefully evaluate your ability to repay the HELOC, so income stability is important to them. It’s a good idea to use a HELOC monthly payment calculator to make sure you’ll be able to make your monthly payments.
Loan-to-Value Ratio
Most lenders will require a combined loan-to-value ratio (CLTV) of 90% or less. Compute your CLTV by adding your existing mortgage balance to the amount you hope your line of credit might be, then divide by your home’s appraisal value. Here’s an example:
Your property is currently valued at $500,000. You still owe $300,000 on your mortgage. You have decided to apply for a $120,000 HELOC.
$300,000 + $120,000 = $420,000
$420,000 / $500,000 = .84
Your 84% CLTV puts you in the right range for many lenders.
Variable vs Fixed Interest Rates
As you just read, HELOCs tend to carry variable interest rates, which are subject to change over the line of credit’s duration. Variable interest rates are often lower to begin with, when you compare them to fixed rates. But by design, they increase or decrease as the market fluctuates.
Tools & Calculators
Online tools can be handy. They will save you time and assist you in calculating approximate payments, or the interest you’ll pay, on a HELOC. Our favorites include a HELOC interest-only calculator, which will help you determine the payments you’ll have to make during the draw period.
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
A “to do” checklist can get you started in your preparation to secure a competitive rate on your HELOC. These tasks will help you think about the factors lenders scrutinize when they determine your eligibility and interest rate. A solid financial standing will enhance your ability to secure different types of home equity loans and credit lines.
Cultivate Your Credit Score
In the past, when you applied for your home loan, your credit score was top priority. It’s just as important now, as you prep to apply for a HELOC. You can build your credit score over time by paying your bills on or before the dates when they’re due. Reducing or eliminating credit card debt is also wise. Review your credit report often, and address errors promptly.
Assess Your Home Equity
Homeowners build home equity with timely mortgage payments. Renovations enhance your equity, too — they not only make your home happier, but also boost its value. If your home equity is in the single digits or teens, getting HELOC approval from a lender may be difficult.
Calculate Your Debt-to-Income Ratio (DTI)
Your DTI ratio is how much you pay each month on the debt you carry (student loans, car loans, personal loans, etc.), divided by your gross monthly income. Home equity lenders tend to look for a DTI below 36%. Some allow up to 50%. Calculating your DTI ratio can help you determine your eligibility for a HELOC, and is an important factor in whether you’ll qualify for desirable terms.
Application Process for a HELOC in Wisconsin
The HELOC application is fairly straightforward, but a clear understanding of each step can help you complete the process efficiently and successfully.
Step 1. Run the Numbers
Check your credit scores and calculate your DTI. You should also get a good estimate of your home equity before you start an application for a HELOC. Some lenders offer online prequalification tools that will help you streamline this process.
Step 2. Compare Lenders
Look into what offers you might be able to qualify for when it comes to interest rates. Also compare lenders’ qualification requirements, credit line minimums and maximums, fees, length of draw and repayment periods, and other details.
Step 3: Gather Your Documents
Pull together paperwork including your proof of income, a detailed employment history, your credit reports, and current documentation of your home’s value.
Step 4: Submit Your Application
You can usually fill out and transmit your HELOC application online. Lenders will also likely let you fill it out by phone or in person. Ensuring that all information you provide is both accurate and complete will prevent delays in your application’s processing.
Step 5: Get an Appraisal
After you submit your application, you’ll need to follow up with a home appraisal to establish your home’s current market value. If the appraisal indicates a value exceeding your outstanding mortgage balance, the lender may approve your HELOC application.
Step 6: Prepare for Closing
Before you can access your HELOC funds, you will need to sign loan documents and most likely pay some fees. (Make sure you fully comprehend all terms and conditions before signing anything, of course.) Some lenders may make funds available in as few as three days following your closing on a HELOC.
Tax Benefits and Considerations
Homeowners can deduct HELOC interest if the funds borrowed are used to buy, build, or significantly improve their primary residence. Interest deductions on the first $375,000 of the HELOC principal are allowed for individual taxpayers ($750,000 is the limit for married couples filing jointly). Consult a tax advisor to help you navigate specific tax implications and confirm eligibility for HELOC-related deductions.
How Much Does a HELOC Cost?
What you’ll pay to establish a HELOC is typically lower than the costs of a home loan or mortgage refinance, which can range from 2 to 5% of the loan amount. The most significant HELOC cost is the appraisal fee, which can be as much as $500. Other costs, like application and administrative fees, will likely be added. Lenders may also charge annual maintenance, transaction, inactivity, and early termination fees. In some cases, they may reduce or waive fees but increase your interest rate. Be sure to compare offers from several lenders.
Alternatives to HELOCs
Other ways to get equity out of your home exist, too, including home equity loans and cash-out refinancing. Personal loans are another option if you prefer an unsecured loan. Carefully consider advantages and disadvantages of each option to choose the one that best meets your requirements.
Home Equity Loan
Unlike a HELOC, a home equity loan can provide a lump sum amount, and you’ll pay it back at a fixed interest rate. Borrowers can usually access up to 85% of the equity they’ve built in their home. Use a home equity loan calculator to estimate your borrowing capacity.
Here’s a quick comparison:
| HELOC | Home Equity Loan | |
|---|---|---|
| Type | Revolving line of credit | Installment loan |
| Interest Rate | Usually variable-rate | Usually fixed-rate |
| Repayment | Repay only what you borrow; you may have the option to make interest-only payments during the draw period. | Starts immediately at a set monthly payment |
| Disbursement | Charge only the amount you need. | Lump sum |
Recommended: What Is a Home Equity Loan?
Cash-Out Refinance
If you’re debating between a cash-out refinance vs. a home equity line of credit, know this: Cash-out refinancing lets homeowners refinance a mortgage for more than what’s owed, and receive the difference in cash. This option suits those needing a large lump sum, and gives you a single monthly payment.
Personal Loan
Personal loans don’t require collateral, so they are a good option for borrowers without significant home equity. A personal loan can get you a lump sum of $1,000–$100,000 that you pay back in regular payments with interest over a set term of 2–7 years. These loans can be used for almost anything, including home improvements, debt consolidation, and other large expenses.
Credit Cards
Credit cards and HELOCs are both forms of revolving debt. Instead of a lump sum of money, you receive access to a credit line, and you can then tap it as needed. Credit cards do, however, come with higher interest rates than HELOCs. That can make them much more expensive if you carry a large balance month after month. While credit cards offer flexibility for smaller purchases, a HELOC can provide a more cost-effective solution for larger expenses like home improvements or debt consolidation.
The Takeaway
A HELOC is a flexible way to tap into your home equity. It’s useful if you need to borrow but aren’t sure exactly how much you’ll ultimately need. You will only pay interest on the amount of the credit line you use at any given time. With good preparation and close attention to your credit score and debt levels, you can present an application that will get you an optimal rate in Wisconsin.
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’s the monthly payment on a $50,000 HELOC?
With an 8.00% interest rate and 10-year term, you’ll pay about $607 monthly. But exactly how much you’ll pay overall will depend on your interest rate and loan term. The same 8.00% interest rate over a 20-year term will cost you $418 per month, but you’ll pay a lot more interest in total.
Is a HELOC a smart move for you?
Whether a HELOC is a good idea now depends on your financial scenario and goals. HELOCs can be ideal for improving your home, consolidating debt, or paying off other large expenses. It’s important, however, to consider interest rates, fees, and the potential impact on your home equity before you make a decision.
What’s the monthly payment on a $100,000 HELOC?
A $100,000 HELOC’s monthly payment depends on both the interest rate and the repayment term you’ve chosen. At 6.00% interest over 20 years, the payment would be $716 per month. An interest rate of 8.00% with the same term would require a monthly payment of $836.
What are the benefits of a HELOC?
A HELOC is a flexible borrowing option. Rather than taking out a lump sum, you can borrow in increments that meet your shorter-term needs, and at a rate that’s likely lower than you’d get with a credit card. The best thing is, you pay interest only on what you borrow at any given time.
Do you need an appraisal for a HELOC?
You do, yes. The appraisal is a crucial step since it helps to establish the value of your home, which in turn determines the amount you’ll be able to borrow. Lenders want to be sure your loan is secured by enough equity in your home. Your lender will give you details about what is required for the appraisal.
What might prevent you from qualifying for a home equity loan?
Some factors will disqualify you from getting a home equity loan, including a bad credit score, a deficit of home equity, and a high level of debt relative to your income.
How hard is it to get a HELOC?
If you can meet lender requirements including a healthy credit score and reasonable debt levels, and you have the minimum equity — usually 15% — in your home, it shouldn’t be too hard to get a HELOC. The most challenging part for many would-be borrowers is compiling financial documents to submit with the application. Taking time to do that carefully and accurately will move the application process along.
How does a HELOC affect your credit score?
When you apply, the HELOC lender will perform a hard inquiry on your credit report. This could cause a temporary decrease in your credit score. Carrying a large balance on your HELOC could also negatively impact your credit utilization ratio, lowering your credit score. But if you make regular payments toward your HELOC, it will demonstrate your ability to use credit responsibly, and that should help you continue to build your 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