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Sep
06
2025

Current HELOC Rates in Chicago, IL Today

By | mortgage | Comments Off on Current HELOC Rates in Chicago, IL Today

CHICAGO HELOC RATES TODAY

Current HELOC rates in

Chicago, IL.



Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.


View your rate

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Compare HELOC rates in Chicago.

Key Points

•  A home equity line of credit, known by the acronym HELOC, is a revolving line of credit secured by your home equity, that you can draw on as you need it.

•  A HELOC can be useful for managing a large or ongoing expense, including a home remodel or college tuition, or for paying off higher-interest debt.

•  The rates lenders advertise for HELOCs are tied to the prime rate, as well as to individual borrowers’ credit scores and scenarios.

•  HELOCs tend to have variable rates, which means that monthly payments can fluctuate over the life of the line of credit.

•  It’s important to understand the risks: If you default on a HELOC, it can lead to foreclosure on your home.

Introduction to HELOC Rates

You’ve found our comprehensive guide to home equity line of credit (HELOC) interest rates in Chicago, Illinois, which can help you make well-informed financial decisions about how to get equity out of your home, whether you are thinking about borrowing funds for a home renovation or paying for another significant expense. The following information will cover factors that influence interest rates on HELOCs, and the benefits and risks of opening one. We will also equip you with an understanding of current market conditions, and tell you how you can find and qualify for the best available interest rates.

What Is a HELOC?

Before you begin making decisions about borrowing, you’ll want to understand just what a home equity line of credit is. A HELOC is a credit line that a homeowner can set up to draw on their home equity. It will let you borrow against your accrued equity as needed, up to a limit set by your lender. With a HELOC, you must pay interest on the money you pull out, along with repaying the principal. Your home is the collateral securing your credit line. This, of course, means that if you don’t repay what you borrow, you could face foreclosure.

What is your home equity? It’s the difference between your home’s value and your mortgage balance. To qualify for a HELOC, you typically need to have at least 15% equity, and you can generally borrow up to 90% of the equity you’ve accrued. HELOC interest rates are variable, which means they often start out lower than rates on unsecured loans.

As a borrower, your HELOC would have two main phases:

The Draw Period

During the initial draw period (usually 10 years) of your HELOC, you can access funds by drawing on an as-need basis. During this time, you’ll likely only pay interest on what you pull out. Most lenders will not require you to pay down the principal, although you can if you wish to pay off the credit line and draw on it again. A HELOC interest-only calculator can be useful during the draw period, as it will tell you the monthly interest you’ll pay on withdrawals.

The Repayment Period

After the draw period ends, your 10- to 20-year repayment period will begin. Monthly payments will increase at this point, because you’ll begin to repay the principal along with the interest. Since HELOC interest rates tend to be variable, the amount you pay monthly may go up or down as time passes and rates change. A HELOC monthly payment calculator can help you compute what you might need to budget for payments.

Where Do HELOC Interest Rates Come From?

Lenders derive interest rates for HELOCs and different types of home equity loans from the prime rate — a figure that moves up or down with the Federal Reserve’s economic maneuvers. Lenders also tack on a margin, and that is why rates can vary widely in the marketplace. The national average interest rate for a HELOC in early September 2025 was 8.10%, but rates have historically ranged from 6.63% to 15.65%.

Getting rate quotes from multiple lenders is a smart thing to do before you apply for a HELOC. Your individual financial profile, including your credit score, level of debt, and the amount of equity you’ve built up in your home, will influence the interest rate you’ll be offered. A higher credit score and more equity are likely to tip the scales in your favor.

How Interest Rates Impact HELOC Affordability

You will need to invest time and energy to effectively shop around to get the best HELOC interest rate. But that should make a big difference in the end in terms of what you’ll end up paying. Even a small reduction in interest rate, if you can find one, will mean you pay less interest over the life of the HELOC. For example, if you were to withdraw $50,000 from a HELOC during your 10-year draw period, the difference in the interest you’d pay monthly based on an 8.50% versus a 9.50% rate is $42 per month (your monthly payment would be $354 or $396, respectively).

If you repay principal plus interest on that $50,000 during a 20-year repayment period, monthly payments at the lower interest rate would be $620. At the higher rate, they would be $647. That may not seem like such a large difference, but think about this: Over the full repayment term, the lower interest rate could save you more than $3,000. Remember, HELOCs have variable interest rates, so the real numbers could end up crunching somewhat differently.

Check out this chart comparing HELOCs at different credit line amounts, terms, and interest rates.

Repayment Amount 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

While it’s not a sole predictor when you’re looking at HELOC rates, the prime interest rate can be a helpful gauge when you’re doing rate research. The prime rate has bounced up and down since 2018, for example — it hit a low of 3.25% back in 2020 and a high of 8.50% in 2023. Knowledge of this history will give you perspective on current rates lenders are offering in Chicago.

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

We know that HELOCs most often come with variable rates, also known as adjustable rates. These rates tend to go up or down over time, based on market conditions. They move at intervals and may be limited by caps that the HELOC agreement should spell out. But overall, the interest amount you pay may change along with the market, and you’ll want to be aware that your HELOC will be subject to possible interest rate changes before you sign up. You may prefer a steady monthly payment, and if that’s the case, a home equity loan might be preferable for you. Keep reading for an explanation of how those work.

Helpful Tools and Calculators

If you’re thinking about jumping on a HELOC offer, it’s a good idea to first estimate what costs it will involve. Online tools can help you do this. Here are a few particularly useful ones.

Run the numbers on your HELOC.

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

If you want to secure a desirable HELOC rate, start by taking a look at your personal numbers. Most important here will be your credit score, your debt-to-income (DTI) ratio, and your level of home equity. Lenders expect you to have at least 15% equity in your home, and it can’t hurt to have more. Here are some tips to help you ensure your finances pass muster before you submit your application.

Improve Your Credit Score

Maintaining a credit score of 700 or above is a key to unlocking the very best HELOC rates. You can ratchet your number higher by paying your bills on time and chipping away at any credit card balances you’ve been accumulating. Review your credit reports regularly for inaccuracies. By disputing and removing errors, you can be sure your score reflects your real financial stability.

Calculate Your Debt-to-Income Ratio (DTI)

Knowing your debt-to-income ratio requires only a simple calculation: Divide your total monthly payments (debts you’re paying off) by your gross monthly income. Most HELOC lenders want you to have a DTI under 50% to qualify. If you want to be eligible for the best HELOC interest rates in the Chicago area, you’ll do better to get your DTI below 36%. Paying down debt (or growing your earnings) are the surest ways to a better DTI.

Application Process for a HELOC in Chicago

If you’d like a quick snapshot of the HELOC rates available in Chicago, along with an estimate of the amount you could qualify for, you can prequalify online. After investigating lenders and rates available to you locally, you can decide if you want to move on to the full application. It will require detailed financial information and property specifics. Here is a step-by-step for the process:

Step 1: Run the Numbers

Before you start working on your HELOC application, it’s advisable to take a very close look at your financial profile. Check your credit score, not at just one but at all three major credit bureaus. You’ll likely need at least a 640 credit score to qualify. Calculate your DTI ratio and your home equity, and understand that the latter will grow as long as you make regular payments on your home loan and take efforts to increase your home’s value (think: curb appeal).

Once again, you can figure out your unofficial home equity percentage by subtracting your outstanding mortgage balance from your home’s estimated value and dividing the answer by that home value number. A formal appraisal may shift that approximate percentage a bit. You definitely need at least 15% equity to proceed.

Step 2: Compare Lenders

Want to find the best HELOC lenders in Chicago? Start by seeing which ones offer the most competitive rates and terms. Look at each institution’s interest rates and qualification criteria, the minimum and maximum amounts they will let you borrow, fees, and their draw and repayment period timespans. HELOC terms vary a lot among lenders, so don’t rush past the fine print.

Step 3: Submit Your Application

Gather the necessary documentation, which will include government-issued ID, recent pay stubs, W-2 forms, and your most recent tax return. If you’re self-employed, a lender may ask you for both a profit-and-loss statement and your tax returns from the last two years. Paperwork related to your property will include the declaration page from your homeowners insurance policy. You can most likely submit your HELOC application online, over the phone, or in person.

Step 4: Get an Appraisal

A home appraisal is a professional, objective analysis to determine your home’s value. It typically costs around $300 to $600 to get one. If your property appraises for $425,000, for example, and that’s more than your mortgage’s current balance, a lender will have more incentive to approve you for a HELOC. That makes this an important step that can help you determine how much equity you can potentially access. It will also influence your HELOC agreement’s terms. Remember, prospective lenders will tell you what kind of appraisal you require, so wait for instructions after you submit the application.

Step 5: Prepare for Closing

Once you’re approved for your HELOC, but before you can access funds from your credit line, you’ll have to sign your agreement and pay your closing costs. Some lenders will make the funds available to you immediately after your closing; others may require you to wait a few days before you can draw on your credit line.

Closing Costs and Fees

A HELOC typically involves lower closing costs than a home mortgage loan or a cash-out refi. The greatest expense tends to be the fee for the appraisal, but other line items include a title search, and application, origination, and administrative fees. Some lenders charge annual maintenance fees that can be up to $250 per year. Lenders sometimes offer to reduce or waive closing costs, but keep in mind that it’s often in exchange for a higher interest rate.

Recommended: HELOC vs. Home Equity Loan

Tax Benefits and Considerations

At this point, homeowners may tax-deduct HELOC interest if the funds they borrow go towards making significant improvements on the primary residence. This policy may change, however, so talk to a tax advisor, be sure deductions apply to your specific circumstances, and keep your invoices and receipts.

Alternatives to HELOCs

You can get equity out of your home with financial tools other than a HELOC, including a home equity loan or a cash-out refinance. Before you decide on a HELOC, you’ll want to consider all of your options — another popular choice is a personal loan.

Home Equity Loan

What is a home equity loan? It’s an option that gives the borrower a lump-sum loan at a fixed interest rate. You can typically use it to borrow up to 85% of your accrued home equity. Home equity lenders look for a credit score of 680 or higher, generally, and many would like your score to be 700 or above if you want their best rate.

If you have a specific need for a defined amount of money and you prefer fixed monthly payments that are predictable over the life of the loan, this might be an attractive option. A home equity loan calculator can help you predict the maximum loan amount you’ll qualify for.

Cash-Out Refinance

This is another option that will let you borrow more than you currently owe on your mortgage, and then collect the extra funds in cash. A cash-out mortgage refinance with a fixed or variable rate is likely open to you if your credit score is 620 or more and your DTI ratio is under 43%.

What is the actual difference between a cash-out refinance vs. home equity line of credit? The refinance option will require just one monthly payment, while with a HELOC you’ll have a mortgage payment and a credit line payment monthly.

Personal Loan

One up-front advantage of a personal loan is that you don’t risk foreclosure if you find yourself unable to make payments, since this option is typically unsecured. Borrowers repay these loans in regular, fixed installments over two- to seven-year periods. Lenders look for borrowers’ credit scores to be 610 or higher for these loans. They are pretty speedy to get — another advantage. But personal loans almost always carry higher interest rates than those on HELOCs.


The Takeaway

If you’re considering applying for a HELOC in Chicago, start by weighing both the potential benefits and the possible risks you’ll take on by activating one. A HELOC offers financial flexibility, It can come with more attractive interest rates than other options, making it a well-suited borrowing choice to manage a large, ongoing expense. But it also brings the risk of foreclosure on your home should you default. Always realistically assess your financial situation before taking out a line of credit. You’ll need a credit score of at least 640 to qualify, and you should look at multiple lenders’ rates if you think a HELOC is the right pick for you.

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.

View your rate


FAQ

Is a HELOC a wise move at this point?

A HELOC could be a good move for you if you’re looking for flexibility to access funds in increments for big expenses, and you feel comfortable signing up for a loan with a variable interest rate — especially if a prime rate drop is in the forecast. But if set payments better suit you, the stability of a home equity loan with a fixed interest rate might be a better choice.

What would the monthly payment on a $100,000 HELOC?

It will depend on your interest rate, repayment terms, and what portion of the credit line you use upfront. The payment on a $100,000 HELOC, if you need to borrow the full amount and you have an 8.00% rate, might be around $667 per month in interest during the draw period. During the repayment phase, your monthly payment would rise to more than $1,200 because you’d start paying down the principal, too. HELOCs’ variable interest rates mean your payments will vary.

Do you need an appraisal to get a HELOC?

Yes, you will need a home appraisal if you want to open a home equity line of credit. You’ll want to wait for your potential lender for instruction, so you know how your home should be appraised in order to meet their terms. This appraisal is necessary to help the lender determine your home’s market value right now, a number that will impact the amount you will be approved to borrow.

Will a HELOC have an impact on your credit score?

Opening a HELOC will involve a hard inquiry on your credit report, and yes, that can cause a slight, temporary dip in your credit score. But if you manage the HELOC responsibly, it can build your credit score down the line. (Missing payments, on the other hand, will definitely make you less creditworthy.)

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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.


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-Q225-392

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Sep
06
2025

Current HELOC Rates in Tucson, AZ Today

By | mortgage | Comments Off on Current HELOC Rates in Tucson, AZ Today

TUCSON HELOC RATES TODAY

Current HELOC rates in

Tucson, AZ.



Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.


View your rate

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Compare HELOC rates in Tucson.

Key Points

•   The home equity line of credit (HELOC) interest rates offered by lenders in Tucson are influenced by the prime rate and overall economic conditions, with the borrower’s financial profile also playing a role.

•   HELOCs offer a flexible way to pull equity from your home; you only pay interest on the funds you use via the credit line.

•   Generally, a HELOC has a variable interest rate. This can lead to unpredictability, since your rate, and future monthly payments, can go up or down.

•   You’ll generally need to have at least 15% equity in your home and a credit score of 640 or better to qualify for a HELOC, and you’ll have to meet other qualifying factors as well.

•   If you default on your HELOC, a foreclosure on your home is a possible consequence.

Introduction to HELOC Rates

This guide to HELOC interest rates brings together all the information you need if you are a homeowner wanting to know how to get equity out of your home in Tucson, Arizona.

If you have been working to pay down your home loan month-to-month and accumulating significant equity in your residence, you may be wondering if a home equity line of credit is the key to paying for an update to your living space, investing in your child’s (or your) educational goals, or consolidating higher-interest debt. Our guide will help you find resources and equip you to make well-informed choices, filling you in on the factors that sway home equity loan rates, these financial tools’ advantages and potential pitfalls, and the secrets to finding favorable lenders and terms for your HELOC.

Just what is a home equity line of credit, anyway? Read on to find out exactly what a HELOC is, what it can do for you, and how to determine if it is the right choice for you.

What Is a HELOC?

A HELOC is a revolving credit line that will allow you to tap into equity you’ve built in your home. Because it is a line of credit, you can use a HELOC to borrow the money you need in increments — up to a maximum amount your lender sets, but only as you need the cash.

You will typically need to have accumulated 15% or more equity to qualify, and you should be able to borrow up to 90% of the equity you’ve got. As a homeowner, you will want to have a repayment plan. Missing HELOC payments will put your home at risk for foreclosure.

A HELOC has two phases:

The Draw Period

In the initial draw period, often lasting 10 years, you’ll be able to access HELOC funds in increments, as you have a need for them. During this phase, you will have to pay interest on the money you borrow to your lender, but most likely you’ll be able to wait till later to start paying down the principal. You will need to do that if you max out the credit line and want to draw on it again. A HELOC interest-only calculator is a useful tool to help you compute just what you’ll have to pay during this phase.

The Repayment Period

When you reach the end of the draw period, a repayment period of 10 to 20 years will begin. More than likely, your monthly payments will increase now. This is because you’ll start paying off not only the interest accruing on the credit you’ve used, but the principal, too. HELOC interest rates tend to be variable, or adjustable, and that means that your rate may change, and your monthly payment amount could rise or fall along with it. During this phase, a HELOC monthly payment calculator can help you predict how interest rate fluctuations might influence the payments you’ll have to make each month.

How Do Lenders Determine HELOC Interest Rates?

Lenders tend to set HELOC interest rates, along with those for different types of home equity loans, by looking at the prime rate. This key interest rate is at least somewhat influenced by the Federal Reserve and its policies. Lenders may add their own margins to the prime rate when determining the interest rates they’ll offer, and they always consider a borrower’s credit score, debt-to-income (DTI) ratio, income, and accrued home equity. That is why lenders offer unique, varying rates. It’s also why it’s a smart idea to look for quotes from multiple lenders before you take out a HELOC.

How Interest Rates Impact HELOC Affordability

What can appear to be a small difference between two lenders’ HELOC rates can make a big difference in the cost of your home equity line of credit in the long run. Your rate on a $50,000 HELOC with a term of 20 years, for example, may differ from another borrower’s by one insignificant-seeming percentage point, from 7.00% to 8.00%. If you got the higher rate, your monthly payment would be about $30 more than if you had the lower one — and the total interest you’d pay over the HELOC’s life would be nearly $7,000 more.

Keep in mind, the more you borrow with a HELOC, the greater effect you will see from even a slight interest rate increase or decrease. Even a fraction of a percentage point can affect the big picture, so you need to keep an eye on what comes after the decimal point.

Check out this chart comparing HELOCs at different credit limits, terms and interest rates.

Repayment Amount 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

If you can keep an eye on the prime interest rate, it will benefit you, since this fluctuating number may successfully clue you in on the direction HELOC rates will be heading. The prime rate has seen significant ups and downs since 2018 — it hit a 3.25% low in 2020 and a high of 8.50% in 2023.

If you can understand this key rate’s historical patterns, you’ll gain a helpful perspective in considering lenders’ rates. Many borrowers try to time their HELOC applications to coincide with a rate dip, but it’s difficult to do, and other, possibly more effective strategies are out there to help you increase the chances you’ll get the best rate available. Let’s discuss those 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


Adjustable vs. Fixed Interest Rates

If you decide to move forward with a HELOC, you’ll want to look at lender offers for starting rates, but also for specifics like how often a rate may change, and if it will likely be capped at some point. A HELOC might be just the right choice for you, if you can handle a bit of financial uncertainty from time to time.

Helpful Tools and Calculators

Before obtaining a HELOC, you will want to check out online tools and try using them to estimate your costs. Here are some useful ones to try out if you think you want to borrow against your home equity.

Run the numbers on your HELOC.

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 Can a Homeowner Qualify for a Competitive HELOC Rate?

Trying to grab the best HELOC rate out there? Your credit score, debt-to-income (DTI) ratio, and level of home equity will be important factors in the equation. Lenders will typically look for you to have built up at least 15% equity in your home — although more will be even better. Follow these tips and you can ensure your finances are up to par before starting your application.

Improve Your Credit Score

Keep your credit score at 700 or better. This is key to unlocking the top HELOC rates. You can slowly but surely nudge your number up by paying your bills on time and paying down, or off, your credit card balances. Be sure to review your credit report, too — you may discover inaccuracies. If you dispute and resolve errors, you can ensure that your score truly reflects your level of financial responsibility.

Calculate Your Debt-to-Income Ratio (DTI)

Completing a simple equation will give you your DTI ratio: Divide your total monthly debt payments by your gross monthly income. Most HELOC lenders want to see a DTI under 50%. But if you want to qualify for Tucson’s best interest rates on HELOCs, you’ll want to try to get yours down below 36%. Try to pay down debt you’re carrying, or increase your earnings — either way, you’ll enhance your financial profile.

Applying for a HELOC in Tucson

By making the effort to get prequalified online, you’ll get a preview of the HELOC rates available to you in Tucson, plus an estimated credit line amount you may qualify for. You can scope out the various lenders and rates before moving on to complete the full application, which requires a lot more financial details and specific property information.

Step 1: Run the Numbers

Before you apply for a HELOC, take a detailed look at your finances. Go over your credit scores from all three major credit bureaus. Crunch the numbers to find your debt-to-income (DTI) ratio. Next, calculate your home equity level — and keep in mind that it will grow as you make your monthly mortgage payments, improve your property, or enjoy home values going up in the area where you live. To find out about how much equity you have, take your outstanding mortgage balance and subtract it from your home’s estimated value, then divide the answer by that estimated home value figure. The percentage you’ll arrive at is that magic number. As we’ve noted, you’ll need 15% equity or more if you want to move forward on a HELOC.

Step 2: Compare Lenders

To find Tucson’s best HELOC lenders, and the right match for you, compare them closely. You want to determine which offer the best interest rates and terms, not only by looking at advertised rates, but by reading the qualification requirements, the minimum and maximum amounts you may borrow, the draw and repayment periods, and various fees, all of which will probably vary among lenders. Spending some time shopping around can reveal a lot. And reading the fine print regarding terms and other details is an important step before committing.

Step 3: Submit Your Application

You’ll need to gather your paperwork, including a government-issued ID, stubs from recent paychecks, W-2 forms, and copies of your last tax return. Lenders may ask to see a profit-and-loss statement, in addition to two years’ of tax returns, if you are self-employed. In addition, you’ll need to provide property documentation, including a homeowners insurance declaration page. You can often submit a HELOC application online, by phone, or in person.

Step 4: Get an Appraisal

What is an appraisal? It’s the analysis of an objective professional that documents your home’s value. A home appraisal typically costs between $300 and $600. You’ll need the appraisal result to exceed your current mortgage balance in order to be approved by a HELOC lender — an important step that helps determine how much equity you can potentially access. Lenders also use appraisal results when they determine your HELOC agreement’s specific terms.

Step 5: Prepare to Close

Once you’ve attained approval, but before you’ll be able to access HELOC funds, you will need to sign your HELOC agreement. You’ll also have to settle your line of credit’s closing costs. Ask about all fees; you should know every cost involved before closing on your HELOC. Some lenders make funds available right after closing, but with others there may be a wait.

Closing Costs and Fees

HELOCs usually involve lower closing costs than home mortgage loans or cash-out refis. The biggest expense tends to be for the appraisal. You may be required to pay for that appraisal, plus a title search, an origination fee, and other administrative fees. Some lenders charge annual maintenance fees that could be up to $250 per year. Note: A lender might offer to reduce or waive closing costs, but that can be in exchange for a higher interest rate (not necessarily a good deal, even if it makes closing easier).

Recommended: HELOC vs. Home Equity Loan

Tax Benefits and Considerations

Homeowners are allowed by the IRS to deduct HELOC interest, currently in cases where they use the funds borrowed to make significant improvements on their primary residence. This policy could change, though. Talk to a tax advisor to be sure deductions apply to your circumstances, and save every invoice and receipt.

HELOC Alternatives

You have options other than a HELOC for getting equity out of your home. These include a home equity loan or a cash-out refinancing, in addition to a personal loan. All the choices have plusses and minuses, depending on your situation. Before you decide on a HELOC, consider every option.

Home Equity Loan

What is a home equity loan? It offers a borrower a loan at a fixed interest rate, and in the form of a lump sum. You can typically use a home equity loan to borrow up to 85% of the home equity you’ve accrued. Lenders tend to look for a credit score of 680 or higher, and many would like your score to top 700 if you want their best rate.

This is a great option if you have a specific need for a defined amount of money, and if you prefer a fixed monthly payment that stays the same over the life of the loan. You can use a home equity loan calculator to determine the maximum loan amount you should qualify for.

Cash-Out Refinance

Another option is a cash-out mortgage refinance, which will let you borrow more than you currently owe on your mortgage and collect the extra funds in cash. If your credit score is 620 or above and your DTI ratio is less than 43%, this option should be open to you. You choose between a fixed or variable rate.

What’s the actual difference between a cash-out refinance vs. home equity line of credit? The refinance option requires only one monthly payment, while with a HELOC you’ll have two: one for your mortgage, and one for the credit line.

Personal Loan

If you choose this option, you won’t risk foreclosure if you find yourself unable to make a payment. A personal loan is typically unsecured, so your home doesn’t serve as collateral. Borrowers typically repay personal loans in fixed installments over a term of two to seven years. Lenders will probably look for your credit score to be 610 or higher with this pick, which is relatively speedy to secure, but also tends to carry a higher interest rate than a HELOC.


The Takeaway

If you’re considering a HELOC in Tucson, weigh both the potential benefits and the possible risks you’ll be taking on. HELOCs offer financial flexibility and may carry more attractive interest rates than other options, making them an attractive borrowing choice if you’re managing large, ongoing expenses. But they come with risks, too — especially the one of losing your home should you default. Realistically assess your financial situation before you take out a loan. You’ll likely need a credit score of 640 or up to qualify. Look at multiple lenders’ rates if you think a HELOC is right for you.

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.

View your rate


FAQ

Is a HELOC a wise move at this point?

If you want flexibility to access funds in increments for big expenses, and you feel comfortable with the idea of a variable interest rate, a HELOC could be a good move for you — especially if you are seeing forecasts of a drop for the prime rate. But if the stability of fixed payments feels like a better fit for you, a home equity loan might be your better choice.

What would the monthly payment be on a $100,000 HELOC?

It would depend on the interest rate, repayment terms, and how much of the credit line you use upfront, but if you borrow the full $100,000 and have an 8.00% rate, the payment on a $100,000 HELOC would be around $667 each month, for interest in the draw period. During the repayment phase, the payment would go up, since you’d start paying down the principal. It would rise to more than $1,200. And since HELOCs have variable interest rates, a shifting rate could impact your payment, too.

Do you need an appraisal to get a HELOC?

Yes, you do. You will need a home appraisal to obtain a home equity line of credit, but your best bet is to wait for instructions from your potential lender — you want your home to be appraised in accordance with that institution’s terms. An appraisal helps a lender determine your home’s current market value, and will influence the amount the lender will approve you to borrow.

Will a HELOC impact your credit score?

When you open a HELOC, it will involve a hard inquiry on your credit report. This can cause a slight, temporary credit score dip. But when you manage your HELOC responsibly, it can also positively impact your credit score down the line. (Missing payments, on the other hand, will make you appear less creditworthy in the future.)

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-Q225-400

Browse other Arizona home guides.

Browse HELOC rates by state guides.

More HELOC resources.

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Read more
Sep
06
2025

Current HELOC Rates in Knoxville, TN Today

By | mortgage | Comments Off on Current HELOC Rates in Knoxville, TN Today

KNOXVILLE HELOC RATES TODAY

Current HELOC rates in

Knoxville, TN.



Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.


View your rate

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Compare HELOC rates in Knoxville.

Key Points

•   Home equity line of credit interest rates in Knoxville are different from lender to lender, so it pays to shop around.

•   HELOCs work like a credit card, with a revolving line of credit.

•   Interest is charged on the amount you borrow, not based on the full credit line.

•   HELOCs have variable interest rates, and knowing what influences HELOC rates can help you anticipate rate changes.

•   Securing a competitive HELOC rate is crucial for keeping costs down.

Introduction to HELOC Rates

This article is a great place to start your research on home equity line of credit (HELOC) rates in Knoxville, Tennessee. We’ll help you understand what a home equity line of credit is, how interest rates are determined, and how to qualify for the best rates. We’ll also cover the benefits and risks of HELOCs, and how to compare different lenders. By the end, you’ll be better equipped to decide if a HELOC is the right financial tool for your needs, and to qualify for the best rates.

What Exactly Is a HELOC?

A HELOC is a flexible financial tool that lets you leverage your home equity (the difference between your home’s value and whatever you still owe on your home loan) to borrow money. Typically, you’ll need to have at least 15% equity in your home to qualify. With a HELOC, you can access up to 90% of your equity. It’s like having a credit card with a “draw period” (often 10 years) where you can access funds and only pay interest, followed by a “repayment period” (10-20 years) where you pay back both the principal and interest.

The Draw Period

This phase can last a decade and is an important distinction between a HELOC vs. a home equity loan. During the draw period, you need only pay interest on the amount you actually borrow. (With a home equity loan, you get a lump sum and start repaying principal plus interest immediately.) A HELOC interest-only calculator lets you see what you might owe.

The Repayment Period

After the draw period comes the 10- to 20-year repayment period when you stop borrowing and start repaying what you owe, with interest. This is when a HELOC monthly payment calculator might be helpful, because HELOCs have variable interest rates that can change with market conditions. This means your monthly payment can be somewhat hard to predict.

Recommended: Different Types of Home Equity Lending

Where Do HELOC Interest Rates Come From?

HELOC interest rates are tied to the prime rate, which is influenced by the Federal Reserve. Each lender adds a margin to the prime rate, resulting in different HELOC rates. This is why it’s so important to shop around and compare rate offers from different lenders. Lenders also consider individual financial metrics, such as credit score, debt-to-income (DTI) ratio, and the amount of equity you have in your home. A higher credit score, lower DTI ratio, and more equity can lead to more favorable HELOC rates.

How Interest Rates Impact HELOC Affordability

Even a percentage point change in your HELOC rate can make a difference in your monthly payments and the total interest you’ll pay over the life of the credit line. For example, if you entered the repayment period owing $100,000 on your HELOC at an 8.00% interest rate, you would pay $1,213 each month. If you had an interest rate of 7.00%, however, you would pay $1,161. The difference may not seem so significant, but it adds up to roughly $6,000 in extra interest over a 10-year period. This is why it pays to seek out the lowest rate.

HELOC Interest Rate Trends

As you start thinking about how to get equity out of your home, you’ll likely begin to watch the prime rate closely. Its movements can hint at what is to come in the lending market. The rate hit a recent low of 3.25% in 2020 and a high of 8.50% in 2023. By looking at this historical data, you can get a sense of the potential ups and downs of HELOC rates, and put the rates you’re seeing in the current market into perspective.

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

HELOCs typically come with variable (also called adjustable) interest rates that are influenced by market conditions. This means your monthly payment amounts may vary. You won’t be surprised by these changes if you’ve read your HELOC agreement. The agreement will spell out how frequently the rate can change and by how much. As long as you feel you can live comfortably with these variations, a HELOC could be a good choice for you.

Helpful Tools & Calculators

Before you take the leap and apply for a HELOC, why not use our online tools to get a sense of what your monthly payments and interest costs might look like? A few minutes with a calculator can give you some valuable insights to help you make a more informed financial decision.

Run the numbers on your HELOC.

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 qualify for a competitive HELOC rate, you’ll want to put your best financial foot forward. Here are two things you can do in the months leading up to your application to better your chances of a great rate.

Improve Your Credit Score

A credit score of 700 or higher is your golden ticket to better HELOC rates. The secret? Timely payments on all your debts and keeping credit card balances in check. Also be sure to give your credit report a once-over, disputing any errors to give your score that extra nudge in the right direction. And avoid closing old credit accounts or opening new ones in the months leading up to your HELOC application.

Calculate Your Debt-to-Income (DTI) Ratio

Your DTI ratio is a simple concept: the sum of your monthly debt payments divided by your gross monthly income. HELOC lenders typically prefer a DTI under 50%, but the lower, the better, and for the best rates, you’ll want a DTI ratio below 36%. How to get there? Reduce your credit card balances and other debts, increase your income, or do both.

Application Process for a HELOC in Knoxville

Many lenders today offer the convenience of prequalifying for a HELOC online, which can significantly streamline the application process. This preliminary step will give you a clear picture of the rates and terms available in Knoxville before you commit to a full application. If you decide to proceed, follow these steps:

Step 1: Run the Numbers

Check that your equity level, credit score, and DTI ratio meet the minimums a lender will look for. That’s 15% equity, a credit score of at least 640, and a DTI of 50% or less. To compute your equity level, subtract what you owe on your mortgage from your home’s estimated value. Then divide the answer by the home value to get a percentage of equity. If it’s at least 15%, move to the next step.

Step 2: Compare Lenders

Compare different lenders to find the best HELOC rate you can get in Knoxville. Don’t just look at interest rates. Narrow the field based on rates, but also look closely at qualification requirements, minimums and maximums, fees, and the length of the draw and repayment periods. Each lender has unique terms and conditions, so read the fine print to understand the full picture of what you’d be signing up for.

Step 3: Submit Your Application

You’ll need to pull together your ID, proof of income (pay stubs, W-2, tax documents), and insurance policy information for the property you’re using as collateral. If you’re self-employed, a lender might ask for a profit-and-loss statement and a couple years’ worth of tax returns. Once you’ve got everything close at hand, you can apply online, over the phone, or in person. Doublecheck the accuracy of the info to keep the process moving along smoothly.

Step 4: Get an Appraisal

After you solidify your choice of lender and submit a complete application, you’ll likely need an appraisal. Work with the lender to ensure you get the appraisal and documentation the lender requires.

Step 5: Prepare for Closing

If you’re approved for a HELOC, you’ll need to sign the HELOC documents and take care of any associated fees. Most lenders will make the funds available within three business days of the closing. Before you sign on the dotted line, be sure you understand all the terms and conditions.

Closing Costs and Fees

The good news is that HELOC closing costs are generally lower than those for a home purchase or a cash-out refinance. The most expensive part of the process is usually the home appraisal, which can range from $300 to $600. You may also have to pay for a title search, which can cost $100 to $450, as well as application, origination, and administrative fees. Some lenders charge an annual maintenance fee, which can be up to $250.

Tax Benefits and Considerations

Here’s some more good news: You can deduct HELOC interest on your 2025 federal return if the funds are used to significantly improve your primary residence. And guess what? A tax advisor can confirm your eligibility for deductions related to the HELOC and who will keep tabs on how tax rules may change in 2026 and beyond. Understanding these potential benefits can help you make a more informed decision about leveraging your home equity.

Recommended: HELOC vs. Home Equity Loan

Alternatives to HELOCs

There are other ways to tap into your home’s equity besides a HELOC, and there’s also a personal loan, which allows you to borrow without using your home as collateral. Cover your bases by making sure you understand how these options differ from a HELOC before you seal the deal.

Home Equity Loan

A home equity loan is often confused for a HELOC, but the two are different. With a home equity loan, you get a fixed sum of money and start repaying it, with interest, immediately. Because the interest rate is fixed, your payment will be the same each month. You can usually borrow up to 85% of your home’s value, minus what you owe, and you’ll need a credit score of at least 680 and a DTI ratio under 50%. Home equity loans are a good option when you need a large sum all at once. A home equity loan calculator can tell you how much you might be able to borrow.

Cash-Out Refinance

A cash-out mortgage refinance lets you refinance your mortgage for more than you currently owe. You then pocket the difference. This is a great option if you need a large amount of money at once, as long as the current interest rates are an improvement on your original rate. Typically, you’ll need a credit score of 620 or higher and a debt-to-income ratio under 43% for this option. When comparing a cash-out refinance vs. a home equity line of credit, note that the former allows you to choose between fixed or variable rates.

Personal Loan

A personal loan is a versatile, typically unsecured loan that you repay in regular, fixed installments over a period of two to seven years, which is shorter than the typical repayment term for a HELOC or home equity loan. The key advantage here is the safety of your home; because your property doesn’t serve as collateral, your home isn’t on the line if you can’t make your payments. Lenders usually look for a credit score of 610 or higher for this type of loan. While the interest rates may be a bit higher than HELOCs or home equity loans, the approval process is often more swift.


The Takeaway

If you’re mulling over a HELOC, take a moment to consider the advantages and potential pitfalls. They do offer flexible borrowing and possibly lower interest rates in Knoxville when compared to personal loans. But a HELOC comes with the risk of foreclosure if you fail to make your payments. So, before you leap, compare rates from different lenders, take stock of your financial well-being, and explore alternatives like cash-out refinancing or personal loans to find the perfect fit for your financial needs.

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.

View your rate


FAQ

What can a HELOC be used for?

A HELOC can be a smart choice for a variety of needs, including home renovations, education expenses, and debt consolidation. They are particularly useful for expenses that are spread out over time, such as educational costs or ongoing home improvements. With a HELOC, homeowners can access funds as needed vs. taking (and immediately making payments on) a large lump sum.

What would the monthly payments be on a $50,000 HELOC?

Your monthly payment on a $50,000 HELOC will vary according to the rates and terms of your agreement. During the draw period, you might only need to pay interest, which can be quite manageable. For instance, at a 7.00% interest rate, your monthly interest-only payment would be approximately $292. But keep in mind, once the repayment period kicks in, you’ll be paying both principal and interest, so your monthly expense will increase. Because HELOCs have variable repayment terms and interest rates, it’s not possible to nail down the precise amount you’ll pay each month.

How tough is it to get a HELOC?

The process of securing a HELOC is quite manageable. You’ll need to make sure you meet the minimum qualifications. Most lenders are looking for you to have at least 15% equity in your home. You’ll also need a credit score of at least 640 and a debt-to-income (DTI) ratio under 50%.

Will a HELOC impact my credit score?

Opening a HELOC may result in a slight dip in your credit score due to the necessary hard credit inquiry by a prospective lender. But use your HELOC responsibly — make payments promptly 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 bad news for your score.

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-Q225-401

Browse other Tennessee home guides.

Browse HELOC rates by state guides.

More HELOC resources.

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Read more
Sep
06
2025

Current HELOC Rates in Plano, TX Today

By | mortgage | Comments Off on Current HELOC Rates in Plano, TX Today

PLANO HELOC RATES TODAY

Current HELOC rates in

Plano, TX.



Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.


View your rate

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Compare HELOC rates in Plano.

Key Points

•   Home equity line of credit rates in Plano are influenced by the prime rate and Federal Reserve policies.

•   You can borrow up to 90% of your home’s value, minus the balance of your mortgage, with a HELOC.

•   The draw period is 10 years, during which you make interest-only payments. After that, you have a 10 to 20-year repayment period.

•   To get the most competitive HELOC rates, a credit score of 700 or higher and a debt-to-income ratio below 36% are usually needed.

•   HELOCs can be a great option for the savvy borrower, offering flexibility and potentially lower interest rates than personal loans.

Introduction to HELOC Rates

Our guide to home equity line of credit rates in Plano, Texas, lays out the factors that impact interest rates, and offers insider tips on how you can qualify for the lowest available rate. We’ll also cover the benefits and risks of HELOCs, current interest rate trends, and tools you can use to estimate your monthly payments and interest costs. By the end of this guide, you’ll be better equipped to decide if a HELOC is the best way for you to borrow.

What Exactly Is a HELOC?

A HELOC is a revolving credit line that uses your home as collateral. This means that in the event that you don’t repay what you borrow, the lender could foreclose on your home. In practice, using a HELOC is a lot like using a credit card. You borrow when you need funds, and you make monthly payments on the amount of the credit line that you have actually used.

To qualify, you’ll need to have at least 15% equity in your home. Your equity is the market value of your home minus whatever you still owe on your home loan. Some homeowners may be able to borrow up to 90% of their equity. The draw period and repayment period are the two phases of a HELOC, and it’s important to understand how payments will differ in each.

The Draw Period

With a HELOC, you’re given a credit limit and a draw period. The draw period can last up to 10 years, and during this time you can borrow, repay (if you wish), and borrow again. Typically, you are only required to make interest payments during the draw period. A HELOC interest-only calculator can help you compute what you might owe at this time.

The Repayment Period

After the draw period, you’ll enter a repayment period of up to 20 years. You can’t borrow any more, and you’ll need to begin making monthly payments of principal plus interest. A HELOC’s variable interest rate means the amount you owe can fluctuate. Use a HELOC monthly payment calculator to calculate what payments look like when you add principal and interest.

Recommended: Different Types of Home Equity Lending

Where Do HELOC Interest Rates Come From?

HELOC interest rates are a product of the prime rate, which is under the sway of Federal Reserve policies. Each lender tacks on a margin to the prime rate, resulting in a range of HELOC rates. This is why it’s so important to seek out rates from multiple lenders before you decide on a lending partner for your HELOC. It’s especially true because lenders also take into account individual borrower factors such as credit score, debt-to-income (DTI) ratio, and the amount of equity in the home.

How Interest Rates Impact HELOC Affordability

The interest rate on your HELOC can make a big difference in how much it costs you. Even a small difference in the interest rate can mean a lot more interest paid over the life of the loan. For example, on a $50,000 HELOC with a 20-year term, a one-percentage-point rate increase from 7.00% to 8.00% during the repayment phase can raise your monthly payment by $30 and increase the total interest paid by almost $7,000. Your exact numbers will differ due to the HELOC’s variable interest rate. But the bottom line is that you want to start your HELOC with the lowest available rate.

HELOC Interest Rate Trends

You’ll likely begin keeping an eye on the prime rate as you think about how to get equity out of your home. Having a sense of the prime rate’s history can give you some perspective on whether current rates are relatively high or low. Over the years, we’ve seen the prime rate dip to an unusually low 3.25% in 2020 and rise to 8.50% in 2023. Where the rate goes, your HELOC interest rate will likely follow.

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

As we’ve noted, HELOCs usually come with adjustable (also called variable) interest rates, which means your rate can go up or down based on market conditions. If you can get comfortable with the possibility of rate increases, you can probably handle a HELOC. One thing to note: Your HELOC agreement would spell out how often your rate can change, and by how much. So there are some guardrails around the rate changes. If you’re someone who can’t rest comfortably without predictability and stable payments, a fixed-rate loan such as a home-equity loan might be more up your alley.

Helpful Tools and Calculators

Before you apply for a HELOC, you can use online calculators to see how much you can expect to pay each month based on the amount you borrow and your current interest rates. You can also learn how much interest you might pay over the life of the HELOC. Here are three useful calculators.

Run the numbers on your HELOC.

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 secure a competitive HELOC rate, you’ll need to have at least 15% equity in your home. Take a few minutes to make sure you’ve hit that benchmark. Subtract what you still owe on your mortgage from your home’s estimated value. Then divide the answer by the home value and you’ll have a percentage. You can move on to the next steps: working on your credit score and DTI ratio.

Improve Your Credit Score

You can get a HELOC with a credit score of 640, but to ensure you’re in a prime position to secure the best available HELOC rates, aim for 700 or higher. Making payments on time and chipping away at credit card balances can give your credit score a lift. Setting up automatic payments is a good idea. Also keep an eye on your credit report so you can fix any errors that crop up. Avoid closing old credit accounts or opening new ones in the months leading up to your HELOC application.

Calculate Your Debt-to-Income (DTI) Ratio

Your DTI ratio is a simple comparison: your monthly debt payments divided by your gross monthly income. For HELOC lenders, a DTI under 50% is the general target, but the lower, the better, and the best interest rates go to those with a DTI ratio of 36% or less. To improve your DTI, focus on paying down debts, increasing your earnings, or both.

Application Process for a HELOC in Plano

For those considering a HELOC in Plano, the application process can be streamlined by prequalifying online. Taking this initial step is helpful because it allows you to understand the current HELOC rates available in Plano and to see what rate and terms you might qualify for. Once prequalified, you can then gather all of the necessary documentation required to formally submit your application, following these steps:

Step 1: Run the Numbers

Before you dive into the application process, it’s wise to give your credit scores a once-over and calculate your debt-to-income (DTI) ratio and home equity level. As long as you have a 640 credit score or better, plus a DTI ratio under 50% and home equity of 15% or better, you’re good to go.

Step 2: Compare Lenders

Next, research and compare different lenders to find the best HELOC rates in Plano. Look at their specific qualification requirements, minimum and maximum credit lines, fees, and the length of the draw and repayment periods. Zero in on the lender that feels like the best fit for you.

Step 3: Submit Your Application

Gather your paperwork. You’ll need recent pay stubs, W-2 forms, and tax returns. If you’re self-employed, you may be asked for a profit-and-loss statement and two years’ worth of tax returns. Have your homeowners insurance policy handy, too. Once you’ve got everything together, you can apply online, over the phone, or in person. Doublecheck the information you provide for accuracy to keep the process moving smoothly.

Step 4: Get an Appraisal

A lender will require a professional and objective analysis of your home’s value, so once you’ve zeroed in on the HELOC offer you find most appealing, you’ll pay between $300 and $600 to secure an appraisal. This step determines the amount of equity you have in your home and is an important part of the HELOC process.

Step 5: Prepare for Closing

Before you can tap into your HELOC funds, you’ll need to sign your HELOC agreement and take care of any fees. Many lenders will have your funds ready within three days of closing. Be sure to review all your documents carefully and ask any questions you have to make sure you’re clear on the terms.

Closing Costs and Fees

The good news is that HELOC closing costs are typically more budget-friendly than what you’d face with a home purchase or refinance. The appraisal fee is often the most significant expense. You might also encounter an application fee, origination fee, and administrative costs. Some lenders may have annual maintenance fees, transaction fees for withdrawals, inactivity fees, or early termination fees. Some lenders are willing to reduce or even waive some of these costs, though this could mean a slightly higher HELOC interest rate, which could cancel out any savings.

Tax Benefits and Considerations

Here’s a nice counterbalance to those fees: Homeowners are eligible to deduct HELOC interest from federal taxes if the funds borrowed are used to significantly improve the primary residence. To make sure you’re getting the most out of your HELOC (and for help itemizing and capturing that deduction), it’s a great idea to chat with a tax advisor. Keep your eyes open for potential changes in how HELOC interest is handled on taxes in 2026 and beyond.

Recommended: HELOC vs. Home Equity Loan

Alternatives to HELOCs

If a HELOC doesn’t feel like the right fit, there are other options to consider. Home equity loans, cash-out refinancing, and personal loans all have their own requirements and benefits.

Home Equity Loan

With a home equity loan, you get a lump-sum loan at a fixed interest rate. You can usually borrow up to 85% of your home equity. Lenders often look for a credit score of 680 or higher, with many leaning toward 700. A difference between a HELOC and a home equity loan is that with the latter, you get the money all at once and begin repaying it, with interest, immediately. A home equity loan calculator can show you what you might be able to borrow.

Cash-Out Refinance

A cash-out mortgage refinance lets you borrow against your home’s equity by trading your current mortgage for a new, larger one. You’ll pocket the difference to use as you wish. To qualify, you’re generally looking at a credit score of 620 or higher, and a debt-to-income ratio under 43%. You can choose fixed or variable rates. A cash-out refinance vs. home equity line of credit point of difference? The former leaves you with just one monthly payment.

Personal Loan

A personal loan is typically unsecured, so you don’t risk foreclosure if you find yourself unable to make payments. It’s typically repaid in regular, fixed installments over a period of two to seven years. Many lenders look for a credit score of 610 or higher for these loans, which is more forgiving than the standard for a HELOC or home equity loan. While they’re relatively speedy to secure, personal loans’ interest rates may be higher than those of HELOCs.


The Takeaway

As you mull over the idea of a HELOC, remember to consider the benefits and potential drawbacks. The flexibility and lower initial costs are attractive, but don’t forget about the variable interest rates and the risk of losing your home if payments are missed. Homeowners in Plano should take the time to compare HELOC offers from different lenders, looking at factors like credit line limits and fees as well as the interest rate. Ensure your financial health is in order, gather the necessary documentation, and be ready for a home appraisal before you apply.

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.

View your rate


FAQ

Is a HELOC a smart move at this time?

Whether a HELOC is a good idea for you depends on your unique financial situation and goals. If you need to borrow a large sum of money but don’t need it all at once or aren’t sure exactly how much you might need, a HELOC could be a good way to borrow, because you’ll only pay interest on the portion of the credit line that you are actively using. At a time of some uncertainty regarding interest rates, you might find borrowing with a HELOC to be a way to hedge your bets: If rates drop somewhat, your variable HELOC rate will drop too. Of course the opposite is also true, so make sure you feel you can comfortably cover monthly payments during both the draw and repayment phases before moving forward.

What would the monthly payment be on a $100,000 HELOC?

The monthly payment on a $100,000 HELOC can fluctuate depending on how much of the credit line you have used and the current interest rate. If you borrow the full $100,000 and have an 8.00% rate, you might only pay around $667 per month to cover the interest during the draw period. Once the repayment phase kicks in, you would start paying down the principal, which will adjust your monthly payment upward to $1,213. Due to HELOCs’ variable rates, your exact numbers will vary.

Do I need an appraisal for a HELOC?

An appraisal is required for a HELOC in most cases. This important step determines your home’s current market value, which in turn helps a lender 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.

What might disqualify you from getting a home equity loan?

A few factors could potentially disqualify you from securing a home equity loan. Most lenders look for a credit score in the upper 600s, a DTI ratio of 50% or less, and a minimum of 20% equity in your home. If you don’t meet these criteria, you might need to work on improving your financial profile or explore other financing sources.

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-Q225-408

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Sep
06
2025

Current HELOC Rates on Long Island, NY Today

By | mortgage | Comments Off on Current HELOC Rates on Long Island, NY Today

LONG ISLAND HELOC RATES TODAY

Current HELOC rates in

Long Island, NY.



Disclaimer: The prime rate directly influences the rates on HELOCs and home equity loans.


View your rate

Turn your home equity into cash. Call us for a complimentary consultation or get prequalified online.

Compare HELOC rates in Long Island.

Key Points

•   Long Island HELOC rates are influenced by both the prime rate and the borrower’s credit profile.

•   HELOCs offer flexibility in accessing funds and potentially lower interest rates than other types of financing.

•   Understanding the draw and repayment periods is key to managing your HELOC effectively.

•   Possible alternatives to HELOCs include home equity loans, cash-out refinancing, and personal loans.

•   HELOCs use your home as collateral, which exposes you to the risk of foreclosure if you fall behind on your payments.

Introduction to HELOC Rates

Welcome to your comprehensive guide to home equity line of credit (HELOC) interest rates on Long Island, New York. We can help you, as a homeowner, understand the current market trends, the factors that influence Long Island’s HELOC rates, and how to qualify for the best terms. You’ll learn about the benefits and risks of HELOCs, as well as what alternative financing options may be open to you. By the end, you’ll be better equipped to decide if a HELOC is right for your financial situation -– and you’ll know exactly how to apply for one.

What Exactly Is a HELOC?

To be able to decide whether a HELOC is a good option for you, you’ll need to understand exactly what a home equity line of credit is. A HELOC is a revolving line of credit that you can draw funds from as you need them, up to a limit determined by your lender and based on how much equity you have in your home. Your home equity is the difference between the property’s value and what you owe on your mortgage, and it serves as the collateral for your HELOC. To qualify, you generally need a minimum of 15% equity, and you can usually borrow up to 90% of that amount. HELOCS have two distinct phases:

The Draw Period

When you get a HELOC, there’s an initial draw period (typically for 10 years) during which you can borrow funds as you need them, up to the limit your lender sets. During this time, you’ll pay interest on whatever you borrow, but most lenders won’t require you to pay back the principal yet. If you do, that will replenish your credit line, letting you take out more if you wish.

The Repayment Period

Once the draw period ends, it’s time for the repayment period, which generally lasts for 10 to 20 years. Now your monthly payments cover principal as well as interest on what you’ve borrowed, so they’ll be higher than during the draw period. HELOC interest rates are usually variable, which means that your monthly payment increases or decreases as rates change.

Where Do HELOC Interest Rates Come From?

HELOC interest rates are set based on the prime rate, which in turn is influenced by the Federal Reserve’s actions. Lenders add their own margin to the prime rate to arrive at HELOC rates, which is why you’ll see different rates at different banks. When you apply for a HELOC, in addition to its current rates, the lender will also consider your credit score, debt-to-income (DTI) ratio, income, and the amount of equity you have in your home to arrive at the rate you’re offered.

How Interest Rates Impact HELOC Affordability

The interest rate on your HELOC has a significant effect on how much you pay each month. And even a small difference in the interest rate can have a big impact on how much interest will cost you over the whole term. For example, a $50,000 HELOC with a 10-year repayment term and a 7.00% interest rate would have a monthly payment of $581 and would cost you $19,665 in interest over the life of the loan. But if the interest rate were just one percentage point higher, to 8.00%, the monthly payment would be $607 and the total interest cost would be $22,797.

HELOC Interest Rate Trends

Keeping an eye on the prime interest rate can be helpful by giving you a sense of where HELOC rates, both on Long Island and across the country, might be heading. Over the years, the prime rate has seen plenty of ups and downs: For instance, it hit a low of 3.25% in 2020 and a high of 8.50% in 2023. Watching the prime rate’s movements and being aware of this history can give you perspective on the current HELOC rates you’re seeing.

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

While HELOCs can have either variable or fixed interest rates, they typically come with the former. These variable rates often start lower than the fixed rate you might be offered on a HELOC, but they fluctuate in response to market conditions. If the prime rate goes up or down, variable rates are likely to follow. Fixed rates may start higher, but they don’t change over the life of the HELOC, offering a stability that some borrowers may prefer. If you move forward with a variable-rate HELOC, it’s a smart move to review the lender’s offer closely so that you understand the specifics of how often rates can change and at what level the rate might be capped.

Helpful Tools and Calculators

Before you apply for a HELOC, you can use online tools to help you estimate your monthly payments. Here are three calculators designed to help you as you consider financing that draws on your home equity.

Run the numbers on your HELOC.

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 be offered an attractive HELOC rate, you’ll need to be sure that your credit score, debt-to-income (DTI) ratio, and amount of home equity are up to lenders’ standards. These tips can help you get your finances ready to present to potential lenders.

Improve Your Credit Score

Keeping your credit score at 700 or above is key if you’re aiming for a good HELOC rate. Paying your bills on time and whittling down your credit card balances can give your score a significant lift, which in turn can lead to a lower HELOC rate. Keep an eye on your credit report, too. Checking regularly could help you spot and dispute any errors so that your record is accurate.

Calculate Your Debt-to-Income Ratio (DTI)

Your DTI ratio represents your total monthly debt payments compared to your gross monthly income and helps lenders understand how much of your income goes toward paying off your obligations. Most HELOC lenders prefer to give their most attractive rates to homeowners with a DTI ratio under 36%. To calculate your DTI ratio, tally up all your monthly debt payments, then divide that total by your gross monthly income. If the result isn’t where you’d like it, work on paying down debt and (if you can) increasing your income – through a side hustle, for example.

Application Process for a HELOC in Long Island

Applying for a HELOC is straightforward, especially if you prequalify online. This preliminary step allows you to see what rate you’re likely to be offered. And if you choose to submit a full application, you’ll just need to pull together the necessary paperwork and give your application to your lender. Let’s take a look at the details of the process:

Run the Numbers

Before you plunge into the process, check your credit scores from all three major bureaus and calculate your debt-to-income (DTI) ratio. Additionally, it’s important to assess your home equity, which grows as you pay down your mortgage and as your home appreciates in value. To determine your equity, subtract your outstanding mortgage balance from your home’s estimated value. Then divide that figure by your home value to get the percentage. As mentioned earlier, most lenders will require that you have at least 15% equity to move forward.

Compare Lenders

Make a point of looking at multiple lenders to see what interest rate offers you might qualify for with each. Additionally, you’ll want to compare the qualification requirements, the HELOC amount minimums and maximums, fees, and the length of both the draw and repayment periods. Investigating the variety of Long Island HELOC rates and terms can help you understand and assess the best deals you can access.

Submit Your Application

Start by gathering the paperwork you need, which will include your official ID, proof of income, and any documents pertaining to the property you’re using as collateral. To prove your income, you can pull recent pay stubs, W-2s, and a couple of years’ worth of tax returns. If you’re self-employed, you’ll want to provide a profit-and-loss statement, too. Don’t forget the declaration pages from your homeowners insurance policy, as well. Once you’ve got everything in order, you can submit your application online, over the phone, or in person.

Get an Appraisal

An appraisal is a professional, objective assessment of your home’s value. Typically costing between $300 and $600, it’s generally required by your lender and it’s a wise investment since it helps determine your equity. If your home appraises for more than your mortgage balance, you’re a step closer to approval for a HELOC. An accurate appraisal is key to securing the best terms and maximum equity access, but be sure to comply with your lender’s appraisal requirements.

Prepare for Closing

Before you can access your HELOC funds, you’ll need to sign all the required loan documents and take care of any necessary fees associated with the loan. Prior to signing anything, carefully review the loan agreement (and any additional requirements the lender may have) and make absolutely certain you fully understand all of the terms and conditions outlined in them.

Following the closing of the HELOC, some lenders make the funds available within approximately three business days, though others may take longer.

Closing Costs and Fees

HELOC closing costs are generally more affordable than those associated with a home loan or a cash-out refinance. The most significant expense is often the appraisal, which can range from $300 to $600. You may also encounter application, origination, title search, and administrative fees, along with annual maintenance fees that could go up to $250. Your lender may offer to reduce or waive closing costs, but be aware that accepting such offers may mean an increase in your interest rate.

Recommended: HELOC vs. Home Equity Loan

Tax Benefits and Considerations

As a homeowner, you may be able to deduct HELOC interest if you use the funds you’ve borrowed to significantly improve your primary residence. There are limits on how much you can deduct and conditions on what constitutes a significant improvement, so it’s a good idea to consult a qualified tax advisor to be sure you understand all the tax implications and confirm your eligibility for HELOC-related deductions.

Alternatives to HELOCs

A HELOC may be an appealing option if you’re trying to figure out how to get equity out of your home. But before you make your final decision, it’s smart to consider all the ways you can tap your equity, as well as another popular borrowing option, the personal loan. Let’s take a look at each.

Home Equity Loan

What is a home equity loan? It’s another way to draw on your home’s equity, but instead of a line of credit, it provides you with a lump sum, which you pay back in monthly installments at a fixed interest rate. With a home loan, you can usually tap into up to 85% of your home’s equity. Lenders often look for a credit score of 680 or more, but some prefer to see 700 or above. If you need a substantial sum upfront and like the idea of consistent monthly payments, this could be for you.

Cash-Out Refinance

A cash-out refinance is a form of mortgage refinance that allows you to borrow more than your current outstanding mortgage balance and take the difference in cash. Lenders usually require a credit score of 620 or higher and a DTI ratio of less than 43%. You can often choose between fixed or variable rates. When should you opt for cash-out refinance vs. home equity line of credit? It’s a good idea to be sure you’d stand to benefit from a refinance before embarking on a cash-out refinancing.

Personal Loan

A personal loan does not draw on your home equity so your home isn’t at risk if you fall behind on payments. You usually repay your personal loan in regular, fixed payments over a term of two to seven years. Many lenders look for a credit score of 610 or higher for personal loans. While they ‘re relatively quick to get, personal loans may have higher interest rates than HELOCs or home equity loans.

Recommended: Different Types of Home Equity Lending


The Takeaway

As you evaluate whether a HELOC is a good financial choice for you, you’ll want to consider both the benefits and the risks. HELOCs are known for their flexibility and competitive interest rates, but you’ll also need to consider the uncertainty of their variable rates as well as the possibility of losing your home if you don’t make your payments. Armed with your new understanding of HELOCs and Long Island HELOC rates, you’ll be able to assess your options and make a choice that will meet your financial needs and goals.

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.

View your rate


FAQ

What can you use a HELOC for?

A HELOC is a versatile financial tool that allows you to spend the funds on just about anything. You can use the money to make home improvements, consolidate debt, pay for college, or cover unexpected expenses. Because a HELOC is a revolving line of credit, much like a credit card, that lets you borrow what you need when you need it (up to the line’s limit), it can be a good choice for funding long-term projects or having on hand for emergencies.

What are the perks of a HELOC?

HELOCs provide multiple benefits. They typically offer lower initial interest rates than unsecured loans, the flexibility to borrow what you need when you need it, and the option to pay interest on only the amount you’ve withdrawn. Plus, there can be tax benefits if you use the funds for major home improvements. Just remember that since your home secures a HELOC, if you fall behind on your payments, you risk foreclosure.

Do you need an appraisal for a HELOC?

Yes, taking out a HELOC will require an appraisal of your property. The appraisal determines the current market value of your home, which is then used to calculate the equity available to you. This, in turn, helps lenders establish the maximum credit limit for your HELOC. The process is designed to ensure that the credit extended to you is in line with the home’s value, safeguarding both you and the lender from financial risk.

How will a HELOC impact my credit score?

When you apply for a HELOC, it may cause a temporary dip in your credit score due to the hard inquiry your lender will make. Fortunately, using your HELOC responsibly — making payments punctually and keeping your balances in check — can ultimately boost your credit score. Just be sure to manage your HELOC wisely, since missed payments or maxing out your line of credit can lower your score.

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-Q225-418

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Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or other eligible status and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates reserved for the most creditworthy borrowers. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, evaluation of your creditworthiness, years of professional experience, income, and a variety of other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Financial Protection and Innovation under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp. or an affiliate, NMLS # 696891. (www.nmlsconsumeraccess.org)

✝︎ To check the rates and terms you 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.

INVESTMENTS: NOT FDIC INSURED • HAVE NO GUARANTEE • MAY LOSE VALUE. Investing in securities involves risks, and there is always the potential of losing money when you invest in securities. The SoFi Wealth platform is operated and maintained by SoFi Wealth LLC, an SEC Registered Investment Advisor. Brokerage services are provided to clients of SoFi Wealth LLC by SoFi Securities LLC, an affiliated broker-dealer registered with the Securities and Exchange Commission and a member of FINRA /SIPC . Clearing and custody of all securities are provided by APEX Clearing Corporation. For more information, please see SoFi Wealth LLC’s Form ADV Part 2 by clicking here for SoFi's Wealth Form ADV Part 2 A&B or by visiting www.adviserinfo.sec.gov .
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