What to know about today’s HELOC loan rates

HELOC (home equity line of credit) rates have been trending low, making them one of the most affordable ways to borrow compared to other options like personal loans or credit cards.They’re a great tool for:

• Borrowing at a lower interest rate than credit cards or personal loans
• Borrow funds for large expenses without refinancing your entire mortgage

With a HELOC, market rates matter a little less than with other loans because your rate adjusts over time. Unlike a fixed-rate mortgage, where you can lock in a low rate for the entire loan term.

The more important question isn’t if rates are at their lowest, but if now is the right time for you to use your home’s equity?

Is now a smart time to get a HELOC?

It might be a smart time to get a HELOC if any of the following apply:

• You have equity in your home
• You want to avoid high-interest credit card debt
• You want access to funds for home improvements, tuition, or large purchases
• You want to consolidate higher-interest debt
• You don’t need a lump sum and prefer borrowing as needed

How do I know if I have enough home equity for a HELOC?

To qualify for a HELOC, most lenders require that you have at least 15% to 20% equity in your home.

You can estimate your home equity by subtracting what you still owe on your mortgage from your home’s current market value:

Home value – Mortgage balance = Estimated equity

For example, if your home is worth $400,000 and you still owe $280,000, you likely have around $120,000 in equity—which is 30%. That’s usually more than enough to qualify.

You don’t need to figure it out perfectly on your own. Many lenders will estimate your equity as part of the prequalification process with no impact to your credit score. It’s usually recommended to visit a couple different lenders’ websites to see who is offering the best rates for HELOC loans based on your situation.

How to qualify for the best HELOC rates

HELOC rates fluctuate with the market and are influenced by factors like inflation, the Federal Reserve, and the broader economy. While you can’t control those, you can control what you bring to the table—like your credit score, home equity, and income

• Have a higher credit score than before
  A stronger credit score may qualify you for the best HELOC interest rates and higher borrowing limits
• Have a lower debt-to-income (DTI) ratio
  Lenders prefer applicants with fewer existing debts compared to their income
• Have at least 15–20% equity in your home
  More equity reduces lender risk and may get you lower rates
• Shop around
  HELOC loan rates can vary by lender. Comparing offers is one of the easiest ways to find the best home equity line of credit rates

How to check your personalized HELOC loan rates

To check your personalized HELOC rate, visit a lender’s site, answer a few basic questions, and get prequalified. This step typically won’t affect your credit score, since it doesn’t involve a hard credit pull. If you decide to move forward, the lender will verify your info with a hard inquiry during the formal application.

How to compare HELOC loans rates using APR

When shopping for a HELOC, you’ll often see the APR (annual percentage rate) listed alongside or instead of the base interest rate. That’s because APR gives a more complete picture of your total cost by including interest plus any fees (like annual maintenance fees and loan closing costs).

• The interest rate tells you what you’ll pay on the amount you borrow
• The APR includes that rate plus lender fees, making it easier to compare loan offers side by side

By focusing on APR, you can better understand which lender is offering the best loan rate overall, not just the one with the best HELOC interest rates.

How the HELOC process works

A HELOC is a revolving line of credit secured by your home. You’re approved for a maximum amount, but you don’t have to take it all at once. Instead, you can borrow as needed during the draw period (usually 5–10 years) and make interest-only payments on what you’ve used.

After that, you enter the repayment period (often 10–20 years), where you’ll pay back both the principal and interest. You can reuse available credit during the draw period, similar to a credit card—without needing to reapply.

You don’t need to open a HELOC with your current mortgage lender. Comparing HELOC offers from multiple lenders can help you find better rates, lower fees, or more flexible repayment terms, even if you’ve been happy with your original lender.

What experts predict for HELOC rates in 2025

Experts expect HELOC rates in 2025 to remain relatively stable—or possibly decline—if inflation continues to cool and the Federal Reserve begins easing interest rates. While rates will still vary by lender and borrower profile, regions with competitive housing markets may continue to offer more attractive deals.

For example, homeowners searching for the best HELOC rates in Florida are seeing increased lender competition in cities like Tampa and Orlando. Similarly, HELOC rates in Arizona and HELOC rates in Michigan remain competitive as more lenders expand into mid-size metro markets.

If you're comparing options in the Midwest, you’ll find that HELOC rates in Ohio and HELOC Omaha products can vary based on your equity and credit—but often come with low or no closing costs.

On the West Coast, the best HELOC rates in California are often found in metro areas like San Diego, where regional banks and credit unions compete heavily. And in the Northeast, borrowers are actively comparing the best HELOC rates in NJ and best HELOC rates in New York, where rates can vary by lender, county, and even property type.

No matter your location, shopping around and comparing lenders is the best way to find a deal that fits your needs and lock in the best HELOC interest rates available to you.