OREGON HOME EQUITY LOAN RATES TODAY
Current home equity loan rates in
Oregon.
Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.
Current home equity loan rates in
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Compare home equity loan rates in Oregon.
Key Points
• Home equity loan interest rates vary based on factors like credit scores, loan-to-value ratios, and economic conditions.
• Home equity loans allow homeowners to borrow against the equity in their homes for various expenses like renovations, education, or debt consolidation.
• Home equity loan interest rates are influenced by the prime rate and prevailing economic conditions.
• Closing costs and fees associated with home equity loans can range from 2% to 5% of the loan amount.
• Alternatives to home equity loans include HELOCs, HECMs, and cash-out refinances, each with its own characteristics and eligibility criteria.
Introduction to Home Equity Loan Rates
If you’ve been considering how to get equity out of your home to fund a costly project such as a kitchen renovation, you may be thinking about applying for a home equity loan. In this guide, you’ll find a thorough update on home equity loan rates in Oregon. We’ll cover how rates are decided and what you can do to obtain the best available rate. We’ve also got the lowdown on other borrowing options as there are different types of home equity loans.
Let’s learn the basics, for starters. What is a home equity, anyway?
How Do Home Equity Loans Work?
A home equity loan is a borrowing option that uses your home as collateral. So if you are still paying off your home loan, the home equity loan is a second mortgage. It’s a lump sum of cash upfront, with repayment over a term that can stretch from five to 30 years. These loans typically come with lower interest rates than unsecured personal loans, and you’ll usually get a fixed rate.
To qualify, you should have at least 20% equity in your primary residence. The funds can be used for a variety of purposes, from renovations to educational costs, medical bills, and debt consolidation. Wondering what borrowing will cost you? A home equity loan calculator can help you figure out how much you might be able to borrow and what the monthly payments will be.
Where Do Home Equity Loan Interest Rates in Oregon Come From?
Economic factors, such as the prime rate set by banks for their most creditworthy customers, as well as policy decisions made by the Federal Reserve, significantly influence home equity loan interest rates. Keeping up with the news on how the Federal Reserve is adjusting its rates and being aware of the current home equity rates in Oregon can help you determine whether the time is right to apply for a home equity loan.
How Interest Rates Impact Home Equity Loan Affordability
Understanding the impact of interest rates on loan affordability is key. Over a standard 20-year loan, a 1% variance in interest rate can translate to a noticeably higher monthly payment and a significantly greater amount of interest paid.
Let’s take a look at what happens if you borrow $30,000 with a 20-year term at three different interest rates:
• 8.00%: the monthly payment would be $251; the total interest paid would be $30,224.
• 7.00%: the monthly payment would be $233; the total interest paid would be $25,822.
• 6.00%: the monthly payment would be $215; the total interest paid would be $21,583.
Of course the more you borrow, the greater the difference in monthly payment and total interest will be.
Home Equity Loan Rate Trends
The prime interest rate is a key indicator of home equity loan rates and can fluctuate significantly, so you’ll want to keep an eye on this number. As you’re doing this, it’s helpful to have a sense of how the rate has changed recently, as well as over a longer period. Since 2018, the prime rate has moved from 3.25% in 2020 to a peak of 8.50% in 2023. The graphic below shows that it has not been above 10% since the 1980s.
Historical Prime Interest Rates
| Date | Prime 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 | 5.50% |
| 9/27/2018 | 5.25% |
Source: St. Louis Fed
Source: TradingView.com
Factors Influencing Home Equity Loan Rates
The prime rate isn’t the only factor guiding the interest rate you might be offered on a home equity loan. Fortunately, some of the other factors are within your control. Lenders take the following factors into account to assess your creditworthiness and the potential risk of the loan.
Credit Score
If you have a strong history of managing credit responsibly and a high credit score, you’re more likely to qualify for a lower interest rate and more favorable loan terms. Most lenders look for a credit score of 680 or higher when considering a home equity loan application. Many lenders prefer a credit score of 700 or higher because they consider these borrowers less risky.
Home Value
Lenders rely on independent appraisals to determine a home’s market value and set borrowing limits. This valuation process helps determine a homeowner’s equity and the maximum loan amount a lender is willing to approve. This protects the interests of both the borrower and the financial institution.
Loan-to-Value (LTV) Ratio
The loan-to-value (LTV) ratio is a key number that lenders examine when you apply for a home equity loan. It’s calculated by dividing the loan amount by the appraised value of your home. Most lenders won’t let you borrow more than 85% of your home’s value. The LTV ratio helps lenders figure out your interest rate and your loan terms.
Home Value Stability
The ebb and flow of home values in your part of Oregon directly impacts the equity you can tap into. When values are on the rise, lenders are more inclined to green-light larger loan amounts, seeing less risk in the game. But if values take a dip, lenders get a bit more cautious, which could mean smaller loan approvals.
Property Location
Where you live can impact your loan in another way, as well: If your property is in an area that is at high risk of extreme weather events or wildfires, a lender may be more cautious and impose a higher interest rate.
Lender Policies
Each lender has its own risk tolerance as well as its own policies regarding the interest rates and terms that are offered on home equity loans. So when you’re comparing lenders, make sure you take this into account.
How to Qualify for the Lowest Rates
To get the best home equity loan rate in Oregon, you’ll want to make sure you have a strong credit score, a low debt-to-income ratio, adequate property insurance, and enough home equity. Let’s look at the details so you’re prepared:
Build a Strong Credit Score
A higher credit score can lead to better rates on home equity loans. Paying bills on time is important for securing these favorable terms. But you’ll also want to look at your credit report now and then and correct any inaccuracies. And avoid using every line of credit that you have to the max — staying well within the limits shows you have mastered responsible financial management.
Manage Debt-to-Income Ratio
When you’re applying for a home equity loan, your debt-to-income (DTI) ratio is a big deal. Add up all your monthly debts (student loan, car loan, etc.) and divide by your gross monthly income. If your answer is below 36%, you’re in good shape. Some lenders will allow a DTI ratio up to 50%. A lower ratio tells them you’re in a strong position to manage your current debt and take on the additional monthly payments of a home equity loan.
Obtain Adequate Property Insurance
If you’re considering a home equity loan, it’s important to make sure you have enough insurance coverage on your property, especially if you live in an area that’s at risk for flooding or other disasters.
Maintain Sufficient Home Equity
You’ll need to have at least 20% equity in your home to qualify for a home equity loan. To ensure you meet this requirement, you should regularly check your home’s value and calculate your equity. Remember that your equity is computed based on current value, not what you paid for your home initially.
Fixed vs. Variable Interest Rates
In Oregon, and across the U.S., home equity loans typically come with fixed interest rates. This means you can count on your monthly payments to stay the same over the life of the loan. While fixed rates offer stability, they can also mean higher initial rates than variable rates, which start lower but can change over time.
Tools & Calculators
You can tell by now that preparing to apply for a home equity loan will involve some math. Online calculators make this easy. You can easily compute how different interest rates and loan terms can affect your monthly payments and the total amount of interest you’ll pay over the life of the loan. Here are a few of our favorite calculators for borrowing against your home equity with a home equity loan or its cousin, a home equity line of credit (HELOC).
Run the numbers on your home equity loan.
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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.
Closing Costs and Fees
As noted above, each lender can have fees and policies that are slightly different. So it’s important to examine fees when you’re choosing a lender. Generally speaking, you can expect to pay closing costs ranging from 2% to 5% of the loan amount. These may include the appraisal, credit report, document preparation, origination, notary, title search, and title insurance. Exactly where each lender lands in the fee range will vary.
Tax Deductibility of Home Equity Loan Interest
Here’s some good news: You can deduct the interest from a home equity loan if it’s used for significant home improvements (just remember to save those receipts). The interest joint filers pay on the first $750,000 of their loan is deductible. For single filers, the number is $375,000. Just remember, you need to itemize deductions to claim this benefit. For the nitty-gritty on maximizing tax benefits, it’s always a good idea to chat with a tax advisor.
Alternatives to Home Equity Loans
In addition to traditional home mortgage loans, there are several alternative financing options available, each with its own distinct features and eligibility requirements.
Home Equity Line of Credit (HELOC)
A home equity line of credit (HELOC) is akin to a credit card, offering you the flexibility to borrow up to a certain limit and only pay interest on the amount you use. But like a home equity loan, a HELOC is secured by your home.
As you think about a HELOC vs. a home equity loan, another thing to keep in mind is that HELOCs usually have a variable interest rate. This can be a double-edged sword, potentially leading to increased costs if interest rates take an upward turn. A home equity loan, on the other hand, has a fixed interest rate.
Home Equity Conversion Mortgage (HECM)
A HECM, or home equity conversion mortgage, is a government-insured reverse mortgage that allows homeowners aged 62 and older to receive payments from the lender based on their home’s value. These payments can be received in various ways: as a lump sum, regular payments, or a line of credit. The beauty of an HECM is that you don’t need to make payments until you leave the home, unlike traditional home equity loans in Oregon. (While SoFi does not offer HECMs at this time, we do offer home equity loans and HELOCs.)
Cash-Out Refinance
A cash-out refinance is a special type of mortgage refinance that allows you to replace your current mortgage with a new, larger one. You use the funds to pay off your old mortgage and keep the extra money for whatever big expense you have on the horizon.
As you consider a cash-out refinance vs. a home equity line of credit or home equity loan, remember that a refinance means an entirely new interest rate and term. So you’ll want to make sure the interest rate available to you with a refi is better than the one you currently have.
The Takeaway
Understanding home equity loan rates and the factors that influence them is crucial to making the best financial decision for your situation. By comparing lenders, taking good care of your credit score, and keeping an eye on the market, you can get the best rates and terms for your home equity loan, and improve your financial outlook.
Unlock your home’s value with a home equity loan from SoFi.
FAQ
What would my monthly payment be on a $50,000 loan?
If you borrow $50,000 with a home equity loan and pay it back over 10 years, the monthly payments could range from $530 to $607, depending on your interest rate (this range is from 5.00% to 8.00%). The two main factors that govern your payments are the interest rate and the loan term, so changes in either of these will alter your payment.
What is the monthly payment for a $100,000 HELOC?
How much interest you’ll pay on a home equity line of credit (HELOC) depends on how much of the credit line you use. But if you’ve used the entire $100,000 HELOC and are paying it back over 20 years at a rate of 7.00%, you can expect to pay $775 per month. You can use a HELOC repayment calculator to find the number for your exact interest rate.
What would the monthly payment be on a $25,000 home equity loan?
Assuming a 10-year term, an interest rate of 8.00% would mean a $303 payment each month. An interest rate of 6.00% would mean a $278 monthly payment. To make the math easier, use a home equity loan calculator to estimate the potential payment.
What would the payment be on a $30,000 home equity loan?
A $30,000 home equity loan with a rate of 8.00% and a 20-year term would cost you $251 each month. Changing the rate or loan term will alter the monthly payment amount.
What might prevent you from securing a home equity loan?
There are a few things that might make you ineligible for a home equity loan, such as lacking enough equity in your home, having a poor credit score, having a high debt-to-income ratio, or not having adequate property insurance.
What are the benefits of a HELOC?
HELOCs, or home equity lines of credit, offer several key benefits. You can borrow only what you need from the credit line — and you only pay interest on the amount that you borrow. They also typically have a lower interest rate than a credit card. Homeowners who need money for a project but aren’t exactly sure how much they will need find the flexibility of HELOCs attractive.
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*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.
²SoFi Bank, N.A. NMLS #696891 (Member FDIC), offers loans directly or we may assist you in obtaining a loan from SpringEQ, a state licensed lender, NMLS #1464945.All loan terms, fees, and rates may vary based upon your individual financial and personal circumstances and state.You should consider and discuss with your loan officer whether a Cash Out Refinance, Home Equity Loan or a Home Equity Line of Credit is appropriate. Please note that the SoFi member discount does not apply to Home Equity Loans or Lines of Credit not originated by SoFi Bank. Terms and conditions will apply. Before you apply, please note that not all products are offered in all states, and all loans are subject to eligibility restrictions and limitations, including requirements related to loan applicant’s credit, income, property, and a minimum loan amount. Lowest rates are reserved for the most creditworthy borrowers. Products, rates, benefits, terms, and conditions are subject to change without notice. Learn more at SoFi.com/eligibility-criteria. Information current as of 06/27/24.In the event SoFi serves as broker to Spring EQ for your loan, SoFi will be paid a fee. Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice. Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
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More home equity 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