Compare home equity loan rates in Boise.

Introduction to Home Equity Loan Rates

Home equity loans are a powerful financial resource for homeowners, giving you the ability to get equity out of your home without selling the property. This guide will take you through the current home equity loan rates in Boise, Idaho, and explain how these rates are affected by a variety of factors.

We’ll also thoroughly explain what a home equity loan is and compare home equity loans with other financial products, discuss the potential risks and benefits, and offer practical guidance on how to secure the most favorable rates. Gaining a clear understanding of home equity loan rates can empower you to maximize the value of your home.

How Home Equity Loans Work

A home equity loan is a second mortgage (assuming you’re still paying off your first home loan). It uses your home as collateral and provides you with a lump sum of money. You’ll begin repaying the loan as soon as you receive it, with interest, and pay it back over a predetermined period — typically five to 30 years.

Because home equity loans usually have a fixed rate, your monthly payments will be consistent and predictable. Your home secures the loan, so the interest rates are often lower than those of unsecured personal loans. To qualify, you generally need at least 20% equity in your home. A home equity loan calculator can help you determine how much you might be able to borrow.

Recommended: Different Types of Home Equity Loans

The Origin of Home Equity Loan Interest Rates

Home equity loan interest rates are determined by lenders based on a combination of economic and personal factors. Lenders set their base interest rates by adding a margin to the prime rate. But a borrower’s financial profile, including their credit score and debt-to-income (DTI) ratio, also plays a big part in determining the precise home equity loan rate they are offered. Higher credit scores and lower DTI ratios typically lead to more favorable rates.

How Interest Rates Impact Home Equity Loan Affordability

Your interest rate is a big deal when it comes to the affordability of a home equity loan. Even a small change in percentage can add up to significant savings or costs over time. For instance, a $100,000 loan at 8.50% interest would run about $985 a month, with a total interest of $77,253 over 15 years. But increase the rate to 9.50%, and you’re looking at a monthly payment of $1,044 and a total interest of $87,960. That’s a more than $10,000 difference in interest alone. So it’s wise to seek out the best possible interest rate and think about how payments fit into your monthly budget and long-term financial goals.

Home Equity Loan Rate Trends

When you’re surveying different lenders’ rates and terms, it can be helpful to have a sense of the history of interest rates. In recent years, we’ve seen the prime rate drop to 3.25% in 2020 and rise again to 8.50% in 2023. These fluctuations have a direct impact on home equity loan rates in Boise and across the nation. It may be tempting to wait for a low rate, but as you can see from the numbers in the chart, shifts can sometimes be slow. If you need to borrow, focus your energies on making sure your application meets lenders’ criteria for the best rates.

How to Qualify for the Lowest Rates

To secure the most competitive home equity loan rates, there are a few key things you can do before filing your applications. Let’s take it one step at a time:

Maintain Sufficient Home Equity

To be eligible for a home equity loan, you need to have at least 20% equity in your home. Calculating your equity is simple: Just subtract your outstanding mortgage balance from your home’s current value. Then divide the result by the home value to arrive at a percentage. For instance, if your home is valued at $550,000 and your mortgage balance is $400,000, then you have $150,000 in equity, which is 27%. Most lenders permit borrowing up to 85% of this equity.

Build a Strong Credit Score

To land the most sought-after home equity loan rates, it helps to have an excellent credit score. Lenders are often looking for a score of 680 or higher, but the real target is 700 or more. A higher score shows you’re a responsible borrower. Want to take good care of your score? Make sure you’re paying your bills on time, keeping credit card balances in check, and steering clear of new debt. It’s also a good idea to look over your credit report and dispute any errors so they can be corrected.

Manage Debt-to-Income Ratio

Your debt-to-income (DTI) ratio is a key metric when it comes to home equity loan eligibility. Lenders typically look for a DTI ratio under 50%, with an even better chance if you’re under 36%. To calculate this, they divide your total monthly debt payments by your gross monthly income. The lower this ratio, the better your chances of securing a loan with competitive rates. To improve your DTI, consider paying down existing debts, boosting your income, or both.

Obtain Adequate Property Insurance

Property insurance is a must-have for home equity borrowers. From the lender’s perspective, having good coverage safeguards the collateral (your home). Be sure to have comprehensive coverage, including any additional protection mandated by your location. Don’t hesitate to touch base with a prospective lender to ensure your protection aligns with its needs.

Recommended: HELOC vs. Home Equity Loan

Useful Tools & Calculators

Online tools can help you figure out whether you’re ready to take on a home equity loan and assist you in comparing home equity loan rates from different lenders. Here are some especially helpful ones.

Closing Costs and Fees

In Boise, closing costs for home equity loans typically fall between 2% and 5% of the loan amount. These fees encompass a variety of expenses, such as appraisal, credit report, document preparation, origination, notary, title search, and title insurance. While no-closing-cost loans are an option, they often come with higher interest rates. It’s wise to compare costs across different lenders when you’re comparing interest rates.

Tax Deductibility of Home Equity Loan Interest

Here’s a tip: The interest on home equity loans can be tax-deductible if you use the funds to improve your Boise home. Couples filing jointly can deduct interest on up to $750,000 of qualified home equity loans, and single filers can claim interest on up to $375,000 in loans. To benefit from this, you’ll need to itemize your deductions when filing your tax return. Discuss this with a tax advisor as tax rules can change year-to-year.

Alternatives to Home Equity Loans

A home equity line of credit (HELOC) and a cash-out refinance are two other common ways to tap into your home’s equity. A HELOC is a revolving line of credit that lets you borrow money as you need it, up to a certain amount. A cash-out refinance is a special mortgage refinance that replaces your existing mortgage with a new one that’s larger than what you owe. You pocket the difference to use as you wish.

HELOCs often have variable interest rates, while cash-out refinances can have either fixed or variable rates. It’s a good idea to compare these options and their rates to see which one might be the best fit for your financial situation and goals. One thing to consider as you think about a cash-out refinance vs. a home equity line of credit or a home equity loan: The cash-out refi is a completely new loan. It will leave you with one payment instead of two. But if the interest rate on your current mortgage is a really favorable one, a refinance may not make sense.

Get more on what is a home equity line of credit vs. a home equity loan and a cash-out refi in the chart below.

The Takeaway

When you’re ready to explore home equity loan rates in Boise, there are a few things to keep in mind. First, take good care of your credit score and try to lower your DTI ratio. These steps can help you secure a better rate. Don’t forget to get the right property insurance, too. Using tools and calculators can help you estimate your monthly payments and the total cost of the loan. Make sure you seek out rate quotes from multiple lenders, and factor in closing costs (don’t just look at interest rates). It takes a little time and energy, but it all pays off when you find the best rate and terms for your situation.

SoFi now offers home equity loans. Access up to 85%, or $350,000, of your home’s equity. Enjoy lower interest rates than most other types of loans. Cover big purchases, fund home renovations, or consolidate high-interest debt. You can complete an application in minutes.

Compare home equity loan rates in Murfreesboro.

Introduction to Home Equity Loan Rates

This comprehensive guide to home equity loan rates in Murfreesboro, Tennessee, will help you understand how rates are shaped and what you can do to secure the best deal. Whether you’re considering a home renovation, paying down high-interest debt, or making a major purchase, you’ll come away with the knowledge to make informed decisions about borrowing. By the end of this guide, you’ll be well prepared to navigate the home equity loan market and find a loan that meets your needs.

How Do Home Equity Loans Work?

To understand the importance of home equity loan interest rates, it helps to have a grasp of what a home equity loan is in the first place. A home equity loan is a second mortgage. Once approved, the borrower gets a lump sum of money. They immediately begin repaying the loan, with interest, over a fixed term — typically between five and 30 years. Because the loan is secured by your home, you can generally get more favorable terms than you would with an unsecured personal loan. But this also means that if you don’t repay the loan, you risk foreclosure.

To qualify for a home equity loan, you typically need at least 20% equity in your home. Equity is the difference between your home’s value and how much you owe on your mortgage. For example, if your home is worth $500,000 and you owe $350,000, you have $150,000 in equity. A home equity loan calculator can help you see almost instantly how much you would likely be able to borrow.

Recommended: What Is a Home Equity Line of Credit?

How Home Equity Loan Interest Rates are Set

Rates on different types of home equity loans are influenced by a variety of factors, from the economic climate to your personal financial situation. Federal Reserve policies have a ripple effect on lending, and lenders’ rates tend to follow the prime rate. Your credit score and debt-to-income (DTI) ratio are pivotal; the higher the score and the lower the ratio, the more favorable your rates. Loan size and term also come into play.

How Interest Rates Impact Home Equity Loan Affordability

The interest rate you get will largely determine the affordability of your home equity loan, just as it did when you bought your home and took out your home loan. Even the slightest rate change, down or up, can translate to significant savings or costs. Consider a $100,000 loan with a 15-year term at 8.50% — that’s a $985 monthly payment and a total of $77,253 in interest. Now, bump that rate to 9.50% and your monthly payment jumps to $1,044, with total interest of $87,961. So it’s clear that nabbing a lower rate could have big benefits.

Here are other examples of loan rates and terms for different loan amounts. Note that the longer the term, the lower the monthly payments — but the more you will pay in interest over the life of the loan.

Home Equity Loan Rate Trends

Predicting interest rate movements is like trying to forecast the weather — it’s not error-proof. But having a sense of the recent history of the prime rate can give you valuable perspective on current rates. The prime rate hit a low of 3.25% in 2020 and a high of 8.50% in 2023. These fluctuations have a direct impact on the rates you might see in Murfreesboro. To get the best deal, some borrowers try to time your application for when the prime rate is low. You may not be able to wait, but you can shop around to see what rates different lenders are offering.

How to Qualify for the Lowest Rates

Securing the most favorable home equity loan rate hinges on your financial standing. Lenders will scrutinize your credit score and DTI ratio to assess your application. Prepare for your application by taking these steps:

Maintain Sufficient Home Equity

To be eligible for a home equity loan, you’ll need at least 20% equity in your home. Give yourself an equity checkup by subtracting your mortgage balance from your home’s current value. (Look up your home value on a real estate web site.) For instance, if your mortgage balance is $400,000 and your home is estimated to be worth $550,000, your equity would be $150,000. To determine the percentage, divide your equity by the home value — in this case, you have 27% equity.

Build a Strong Credit Score

To get the most attractive home equity loan rates, a robust credit score is your ticket. Lenders usually favor scores of 680 or higher, with the 700 mark giving you access to better rates. The higher your score, the more financially prudent you appear, potentially translating to more appealing loan terms. If you have a track record of timely payments and judicious credit management, a lower interest rate could be in the cards. It’s a smart move to peruse your credit report for any glitches and address them before you apply.

Manage Debt-to-Income Ratio

Your DTI ratio is a critical piece of the home equity loan puzzle. Lenders generally look for a DTI below 50%, with 36% or lower being ideal. To calculate your DTI, divide your total monthly debt payments by your gross monthly income. The lower the ratio, the better your chances of securing a competitive rate. If your DTI is on the higher side, consider chipping away at existing debts or finding ways to boost your income. Not only will this improve your odds of approval, but it could also lead to a more favorable rate.

Obtain Adequate Property Insurance

Property insurance is a must-have for most home equity loans, especially in areas with a history of flooding. This insurance shields both you and the lender in the event of property damage. When you apply for a home equity loan, lenders will want to see proof of property insurance. Making sure you have the right coverage can not only help you secure the loan but also potentially influence the rates you’re offered.

Useful Tools & Calculators

Online tools can help you make decisions about the loan amount and loan type you’re going to choose. These are a few of our favorites.

Closing Costs and Fees

In Murfreesboro, closing costs typically run from 2% to 5% of the loan. These fees can include the appraisal, credit report, document preparation, origination, notary, title search, and title insurance. When you compare offers from different lenders, don’t just look at interest rates — consider fees as well.

Tax Deductibility of Home Equity Loan Interest

The interest on a home equity loan could be tax deductible if it’s used to improve your home. For those who are married and file jointly, you can deduct interest on loans up to $750,000; for single filers, that’s up to $375,000. Just remember, you need to itemize your deductions to claim this benefit so a consultation with a tax advisor might be in order.

Alternatives to Home Equity Loans

There are other ways to borrow based on your home equity, so before you set your sights on a home equity loan, it’s worth exploring a home equity line of credit (HELOC) and a cash-out refinance. All three tap into your home’s equity, but each comes with its own set of features and requirements.

Here’s a look at how the three options stack up:

The Takeaway

Home equity loans are a powerful resource for homeowners seeking to leverage the equity in their property. Cultivating a robust credit standing, managing your DTI ratio, and having a solid base of home equity can lead to more favorable loan terms. Alternatives like a HELOC or cash-out refinance present different benefits. Always weigh your options, comparing lenders and loan products to pinpoint the best match for your circumstances.

SoFi now offers home equity loans. Access up to 85%, or $350,000, of your home’s equity. Enjoy lower interest rates than most other types of loans. Cover big purchases, fund home renovations, or consolidate high-interest debt. You can complete an application in minutes.

Compare home equity loan rates in Greenville.

Introduction to Home Equity Loan Rates

Home equity loans are a smart way for homeowners to get equity out of their home. We will examine current home equity loan rates in Greenville, South Carolina, and explain how lenders decide what rate you will be offered, so that you can find the best deal for your situation.

Along the way we will explain what a home equity loan is and how it differs from other methods of borrowing. By the end of this guide, you will be well equipped to shop for a home equity loan and make the best financial decision for your needs.

Recommended: Different Types of Home Equity Loans

How Do Home Equity Loans Work?

A home equity loan is a second mortgage that leverages the value of your home. You’ll receive a lump sum, which you’ll immediately begin to repay in fixed monthly installments over a period of five to 30 years. Because these loans are secured by property, they often come with lower interest rates than unsecured personal loans. They also offer a fixed interest rate, which is an attractive feature for many borrowers because payment amounts are predictable.

To qualify, most lenders will look for you to have at least 20% equity in your primary residence. A home equity loan calculator can help you determine what you might be able to borrow. It’s important to have a plan in place for repaying the loan, because if you miss payments your home could be at risk of foreclosure.

Note that a home equity loan is different from a home equity line of credit. We’ll explain a HELOC vs. a home equity loan below.

The Origin of Home Equity Loan Interest Rates

Home equity loan rates are determined by several factors, including economic conditions and your own qualifications as a borrower. The Federal Reserve’s policies can have a big impact on the lending market, specifically the prime rate, and many home equity loan rates are tied to this rate. Lenders are guided by the prime rate, but each individual borrower’s credit score and debt-to-income (DTI) ratio will also play a role in the rate you’re offered. Generally speaking, higher loan amounts and longer repayment terms come with higher interest rates.

How Interest Rates Impact Home Equity Loan Affordability

You probably recall that when you purchased your home, your home loan interest rate was critical. The same is true of a home equity loan. Even a small percentage difference can add up to a significant amount over time. For instance, take a $100,000 home equity loan with a 15-year repayment term. At 8.50% interest, your monthly payment would be approximately $984, with total interest of $77,253. But at 9.50%, your monthly payment jumps to around $1,044. A monthly difference of $60 may not seem so substantial, but over the life of the loan, it means paying an additional $10,000-plus in interest costs.

Take a look at another example, this time for a $75,000 loan repaid over 20 years:

Home Equity Loan Rate Trends

Predicting interest rate movements is like trying to forecast the weather — there are many variables at play. But a look at the prime rate’s history can give you a sense of perspective on the numbers you’re seeing in the current market. The rate dropped to 3.25% in 2020 and then climbed to 8.50% by 2023. These changes can have a big impact on home equity loan rates.

Some borrowers try to time their application to take advantage of favorable conditions. If you can’t afford to wait, you can secure a more competitive rate by shopping around and getting quotes from multiple lenders before deciding on the rate and terms for your loan.

How to Qualify for the Lowest Rates

The prime rate is out of your control but focusing on caring for your credit score, keeping your DTI ratio low, and ensuring you have ample home equity can help your case when you’re pursuing a home equity loan. Take these steps before submitting any applications:

Maintain Sufficient Home Equity

You’ll want to ensure you have at least 20% equity in your home so that you are eligible for a home equity loan. Calculating your equity is a breeze — just subtract your mortgage balance from your home’s current value, then divide the product by the home value to arrive at a percentage. You can achieve a robust equity level by making additional payments toward your mortgage principal or doing renovations.

Build a Strong Credit Score

To lock in the most favorable home equity loan rates, set your sights on a credit score of 700 or higher. Lenders consider this a sign of your financial prudence and thus that you are at lower risk of default. To nurture your score, make a habit of timely payments, keep credit card balances in check, and steer clear of unnecessary credit inquiries. Periodically check your credit report for inaccuracies and request a correction to any you find.

Manage Debt-to-Income Ratio

Your DTI ratio is an important indicator of your financial health, and lenders typically look for a DTI below 50%, with the most favorable rates going to customers with a 36% or lower DTI. To improve your DTI, consider paying down your debts, finding ways to boost your income, or both. Calculate your DTI by adding up your monthly debt payments and dividing by your gross monthly income.

Obtain Adequate Property Insurance

Property insurance is a must-have for most home equity loans. This coverage reassures the lender that the collateral on the loan (your home) is paid for in the event of a disaster. Make sure your insurance policy meets your lender’s requirements to avoid any hiccups in the loan process.

Useful Tools & Calculators

A home equity loan calculator can help you estimate the amount you can borrow. But it’s not the only useful thing in the toolbox. Here are a few you might need during your borrowing journey.

Closing Costs and Fees

Closing costs for home equity loans in Greenville run between 2% and 5% of your loan amount. Typical fees cover the appraisal, credit report, document preparation, origination, notary, title search, and title insurance.

Tax Deductibility of Home Equity Loan Interest

Here’s a potential bonus: The interest you pay on a home equity loan may be tax-deductible if the funds are used for significant renovations. As of 2025, married couples filing jointly can deduct interest on up to $750,000 of qualified home equity loans, while single filers can deduct interest on up to $375,000. To claim this deduction, you must itemize your deductions on your tax return. The tax break can be a significant benefit, potentially offsetting some of the costs associated with borrowing. However, consult a tax advisor to understand how this applies to your specific financial situation.

Alternatives to Home Equity Loans

While home equity loans are a popular choice, there are other options to consider, such as a home equity line of credit (HELOC) and a cash-out refinance. By comparing these alternatives, you can find the best fit for your situation.

The Takeaway

If you’re mulling over a home equity loan in Greenville, you’ll want to take a good look at your credit score and DTI ratio and make sure your property insurance is up to snuff. These are the keys to unlocking the best home equity loan rates. Use online calculators to wrap your head around the costs of borrowing. And remember that a HELOC or a cash-out refinance could also be an option. Seek out rates from multiple lenders along the way — it’s the best way to snag the most competitive terms and rates.

SoFi now offers home equity loans. Access up to 85%, or $350,000, of your home’s equity. Enjoy lower interest rates than most other types of loans. Cover big purchases, fund home renovations, or consolidate high-interest debt. You can complete an application in minutes.