Images by GetTyimages. Illustrations by bankrate
There hasn’t been much movement in home equity loan fees this past week. According to Bankrate’s National Lenders Survey, the average rate for the $30,000 Home Equity Line (HELOC) was unchanged at 8.27%. The average rate for a $30,000 home equity loan rose to 8.26% on one basis.
HELOC rates have been rising since spring, but the home equity loan rate is approaching its low in 2025. In fact, the five-year loan and credit line are almost exactly the same. Christopher Carter, vice president sales manager at Unibest Home Loan, a Philadelphia-based home equity lender, says homeowners considering borrowing for their home equity should ask themselves a set of questions.
- What is my intention for loans and lines?
- How much do I want to borrow?
- How quickly are you going to pay it back? Do you want to pay the principal extra?
- How much will you plan to occupy your property?
- How much stock will I maintain after closing and what if the property value deteriorates?
- What is my plan for there to be devastating developments in employment, income, or health?
| the current | 4 weeks ago | 1 year ago | 52-week average | 52 weeks low | |
|---|---|---|---|---|---|
| helic | 8.27% | 8.14% | 9.17% | 8.56% | 7.90% |
| 5 Years of Home Equity Loan | 8.26% | 8.24% | 8.60% | 8.42% | 8.23% |
| 10 Years of Home Equity Loan | 8.42% | 8.39% | 8.74% | 8.55% | 8.38% |
| 15 years of home equity loan | 8.35% | 8.32% | 8.73% | 8.49% | 8.32% |
| Note: The home equity rate for this study is assumed to be a $30,000 line or loan amount. | |||||
What is your home equity rate today?
Prices for Helocs and Home Equity Loans are driven primarily by two factors: Lender competition and federal reserve action for new clients. The Fed affects the cost of variable rate products, especially for HeLocs.
Both HELOC and home equity loans fell sharply from their hit highs in early 2024, reaching HELOC rates, which were not seen, particularly after 2023. Bankrate Chief Financial Analyst Greg McBride predicts that in 2025 it will be potentially at the lowest level for three years.
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Current hOmelette rate vs. other types of credit rates
Because Helocs and Home Equity Loans use their homes as collateral, the fees tend to be much cheaper than the interest charged on credit cards or personal loans.
| Credit Type | Average rate |
|---|---|
| helic | 8.27% |
| Home Equity Loan | 8.26% |
| Credit Card | 20.15% |
| Personal loan | 12.65% |
| Source: Bankrate National Lenders, June 25th | |
Of course, the individual offers you receive on a particular HELOC or a new home equity loan reflect additional factors such as creditworthiness and financial obligations. Then there is the value of your home and your ownership. Lenders generally limit all home loans (including mortgages) to up to 80-85% of the value of your home.
Even if we can secure a good rate from lenders, home equity products are still relatively high debt, Rothman points out.
“Now that the average residential equity loan and credit rate line is in the 8% range, so that’s close to the boundary of what distinguishes low-cost and high-cost liabilities,” he says. “It’s not as low as the sub-4% rate I saw three years ago, but not as high as the 10% rate I observed a year and a half ago.”
