A home equity line of credit (HELOC) gives homeowners with at least 15% to 20% equity access to flexible financing.
You can tap into that credit line for expenses such as home renovations or to consolidate debt. Because the credit line remains available for a long time -- a typical draw period is 10 years -- it’s a good way to fund ongoing home projects. A HELOC can also be a source of funding for unexpected expenses, and the interest rate you pay will be lower than a credit card.
The main drawback of a HELOC is that your home serves as collateral for the loan. If you fall behind on payments, you risk foreclosure and could lose your home.
I’ve spoken with experts about how these lines of credit work and where to find the best rates. Here’s what you need to know to determine if a HELOC is the right fit for you.
This week's HELOC rates
Here are the average rates for home equity loans and home equity lines of credit as of May 14, 2025.
| Loan type | This week's rate | Last week's rate | Difference |
|---|---|---|---|
| $30,000 HELOC | 8.14% | 7.99% | +0.15 |
| 10-year, $30,000 home equity loan | 8.52% | 8.51% | +0.01 |
| 15-year, $30,000 home equity loan | 8.42% | 8.41% | +0.01 |
Note: These rates are averages determined by a survey conducted by Bankrate of the top 10 banks in the top 10 US markets.
Current HELOC rates and trends
Aggressive interest rate hikes by the Federal Reserve have directly impacted variable-rate HELOCs for more than two years, increasing the costs for borrowers.
Now that the Fed has started cutting interest rates, HELOC rates are starting to trend trend down. Average HELOC rates are currently just above 8%, according to data from Bankrate.
That’s higher than current average mortgage rates -- which are now just below 7% -- but is still a better deal than other financing options like credit cards or personal loans.
“As rates start to decline this year, variable-rate products like HELOCs become more attractive as borrowers will be able to benefit from the rate of decreases without the need to refinance,” said Matthew Sanford, administrative vice president of mortgage lending at Skyla Federal Credit Union.
Top HELOC rates for May 2025
| Lender | APR | Introductory APR | Loan amount | HELOC terms | Max LTV |
| U.S. Bank | 7.95% to 11.6% | N/A | $15,000 - $750,000 (up to $1 million for properties in California) | 10-year draw period, unspecified repayment period | 80% |
| TD Bank | 7.44% (0.25% TD checking account discount included) | N/A | From $25,000 | 10-year draw period, 20-year repayment period | 89.99% |
| Connexus Credit Union | From 8.17% | 5.99% until April 2026; 6.49% until Oct. 2026 | $5,000 - $200,000 | 15-year draw period, 15-year repayment period | Not specified |
| Spring EQ | Fill out an application for personalized rates | N/A | $50,000 - $500,000 | 10-year draw period, 20-year repayment period | 90% for home equity loans, not specified for HELOCs |
| KeyBank | From 8.2% (0.25% KeyBank client discount included) | N/A | From $10,000 | 15-year draw period, 15-year repayment period | 90% |
| Third Federal Savings & Loan | 6.99% | N/A | $10,000 - $200,000 | 10-year draw period, 30-year repayment period | 80% |
| PNC Bank | Fill out an application for personalized rates | N/A | $10,000 - $1 million | 10-year draw period, 30-year repayment period | 89.90% |
| Frost Bank | 8.15% to 18% (0.25% autopay discount included) | N/A | From $8,000 | 10-year draw period, 20-year repayment period | 80% |
| Regions Bank | 8.25% to 15.125% (Regions client discount included) | 4.99% for first 6 months | $10,000 - $500,000 | 10-year draw period, 20-year repayment period | 95% |
| Citizens | From 7.5% (0.25% autopay discount included) | N/A | From $5,000 | 10-year draw period, 15-year repayment period | 80% |
| BMO Harris | From 7.88% (0.5% autopay discount included) | 5.99% for first six months or 6.99% for first 12 months | From $10,000 | 10-year draw period, 20-year repayment period | 70% |
| Flagstar Bank | 8.49% to 21% (0.25% autopay discount included) | 6.75% for first six months | $10,000 - $1 million | 10-year draw period, 20-year repayment period | 89.99% |
| Truist | 7.5% to 15% | 5.99% for first nine months | From $10,000 | 10-year draw period, 20-year repayment period | 85% |
| Figure | From 7.05% | N/A | $15,000 - $400,000 | Five, 10, 15, or 30 years | 95% |
| PenFed Credit Union | From 7.375% | N/A | $25,000 - $1 million | 10-year draw period, 20-year repayment period | 90% |
Note: Annual percentage rates as of May 6, 2025. APRs may change daily or weekly. Your APR will depend on factors such as your credit score, income, loan term and whether you enroll in autopay or other lender-specific requirements.
Comparing the best HELOC lenders for May 2025
U.S. Bank
Good for nationwide availability
- HELOC APR: 7.95% to 11.6%
- Loan amount: $15,000 – $750,000, up to $1 million for properties in California
- HELOC terms: 10-year draw period, unspecified repayment period
- Maximum LTV ratio: 80%
U.S. Bank offers both home equity loans and HELOCs in 47 states (not including Texas, South Carolina and Delaware). Interest-only HELOCs are available to qualified borrowers. You also have the option to lock all or part of your outstanding HELOC balance into a fixed-rate option during your draw period. We like U.S. Bank because of its extensive nationwide availability, many customer support options and price transparency — meaning you can get a personalized rate quote and fee information by filling out some basic information, no credit check required.
Read CNET’s review of U.S. Bank.
TD Bank
Good for price transparency
- HELOC APR: From 7.44% (0.25% TD checking account discount included)
- Loan amount: From $25,000
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 89.99%
TD Bank offers home equity loans and HELOCs in 15 states, with the option of an interest-only HELOC and a rate-lock HELOC. Loan amounts for HELOCs start at $25,000. Although its nationwide availability is limited, TD Bank ranks high for its price transparency and wide variety of product offerings, including interest-only and rate-lock options on its HELOCs. The bank’s good online user experience, price transparency and customer service options stand out to us.
Read CNET’s review of TD Bank.
Connexus Credit Union
Flexible credit union eligibility
- HELOC APR: From 8.17%
- Introductory APR: 5.99% until April 1, 2026; 6.49% until Oct. 1, 2026
- Loan amount: $5,000 to $20,000
- HELOC terms: 15-year draw period, 15-year repayment period
- Maximum LTV ratio: Not specified
Connexus Credit Union offers home equity loans and HELOCs in 46 states (excluding Alaska, Hawaii, Maryland and Texas). It also offers an interest-only HELOC. Because Connexus is a credit union, its products and services are only available to its members. You can see the full membership eligibility requirements here. Connexus offers expansive nationwide availability and a few different product options, part of the reason this lender ranked highly for us. Its straightforward application process and relatively easy membership requirements is another bonus.
Read CNET’s review of Connexus Credit Union.
Spring EQ
Good online application experience
- HELOC APR: Fill out application for personalized rates
- Loan amount: $50,000 to $500,000
- HELOC terms: Not specified
- Maximum LTV ratio: 90% for home equity loans, not specified for HELOCs
Spring EQ operates in 41 states and offers home equity loans, HELOCs and interest-only HELOCs. Home equity loan amounts range from $5,000 to $500,000, while HELOC line amounts range from $50,000 to $500,000. You must have a minimum credit score of 680 and a debt-to-income ratio of 45% or less. We like that borrowers can get prequalified for a Spring EQ loan with only basic information. This makes it easy to compare rates without providing sensitive information or undergoing a hard credit check. Additionally, the online application experience is user-friendly with an easily digestible breakdown of rates, fees and terms.
Read CNET’s review of Spring EQ.
KeyBank
Wide range of product offerings
- HELOC APR: From 8.2% (0.25% KeyBank client discount included)
- Loan amount: From $10,000
- HELOC terms: 15-year draw period, 15-year repayment period
- Maximum LTV ratio: 90%
KeyBank offers home equity loans to customers in 15 states and HELOCs to customers in 44 states. Aside from a standard HELOC, KeyBank also offers interest-only and rate-lock options. KeyBank’s extensive product offerings stand out to us. The lender’s streamlined application process for existing users is also useful. Both existing and new users will appreciate the online user experience and availability of customer service options from KeyBank.
Read CNET’s review of KeyBank.
Third Federal
Good for long repayment periods
- HELOC APR: 6.99%
- Loan amount: $10,000 to $200,000
- HELOC terms: 10-year draw period, 30-year repayment period
- Maximum LTV ratio: 80%
Third Federal Savings & Loan offers HELOCs in 26 states and home equity loans in only eight states. A HELOC from Third Federal comes with a 10-year draw period and 30-year repayment period. We like Third Federal’s application process and the lender’s price transparency. The lender’s website also features a helpful comparison tool if you’re unsure of what kind of home equity product you’re looking for. Third Federal’s rate match guarantee stands out to us.
Read CNET’s review of Third Federal.
PNC Bank
Good option for fixed-rate HELOCs
- HELOC APR: Fill out application for personalized rates
- Loan amount: $10,000 to $1 million
- HELOC terms: 10-year draw period, 30-year repayment period
- Maximum LTV ratio: 89.9%
PNC Bank operates in 44 states. PNC doesn’t offer home equity loans, but it does offer both variable-rate and fixed-rate HELOCs. PNC has large loan limits of up to $1 million. We like PNC Bank because of its range of product offerings and straightforward application. The bank is also transparent about its rates, fees and terms without requiring a credit check. Although PNC doesn’t offer home equity loans, it has good nationwide availability for HELOCs.
Read CNET’s review of PNC Bank.
Frost Bank
Good option for Texas borrowers
- HELOC APR: 8.15% to 18% (0.25% autopay discount included)
- Loan amount: From $8,000
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 80%
Frost Bank, headquartered in San Antonio, Texas, offers products only to Texas residents. It offers home equity loans, HELOCs and interest-only HELOCs. Home equity loans are available with loan amounts of $2,000 and up, while HELOCs are available with line amounts of $8,000 and up.Although Frost Bank’s nationwide availability is very limited, the bank has a helpful product selection tool, easy application process and good price transparency, making it a strong option for Texas borrowers.
Read CNET’s review of Frost Bank.
Regions Bank
Good for autopay discounts
- HELOC APR: 8.25% to 15.125% (autopay discount included)
- Introductory APR: 4.99% for first six billing cycles
- Loan amount: $10,000 to $500,000
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 95%
Regions Bank serves people across the South, Midwest and Texas, offering home equity loans and HELOCs in 15 states. HELOC offerings include a rate-lock option for those who want it. Home equity loans have amounts of $10,000 to $250,000 and HELOCs have line amounts ranging from $10,000 to $500,000. Regions gives people the flexibility to choose between home equity loans, HELOCs and rate-lock HELOCs. We also like the different application and customer service options Regions offers.
Read CNET’s review of Regions Bank.
Citizens
Good option for low loan amounts
- HELOC APR: From 7.5% (0.25% autopay discount included)
- Loan amount: From $5,000
- HELOC terms: 10-year draw period, 15-year repayment period
- Maximum LTV ratio: 80%
Citizens offers standard and interest-only HELOCs to borrowers in 19 states. The bank doesn’t offer home equity loans. Line amounts for HELOCs start from $5,000, which is lower than what many other lenders offer. Though Citizens’ nationwide availability is limited, we ranked it highly for its price transparency, responsive customer service and range of HELOC options.
Read CNET’s review of Citizens.
BMO Harris Bank
Good introductory APRs
- HELOC APR: From 7.88% (0.5% autopay discount included)
- Introductory APR: 5.99% for first six months or 6.99% for 12 months
- Loan amount: From $10,000
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 70%
BMO Harris (a subsidiary of the Canadian financial services company Bank of Montreal) offers products and services in 48 states (all but New York and Texas). The bank offers standard and interest-only HELOCs and the option to lock in your balance at a fixed rate. It also offers home equity loans. HELOC line amounts start from $10,000. We like that BMO Harris offers both home equity loans and three types of HELOCs almost nationwide. We found its online application less straightforward than its competitors.
Read CNET’s review of BMO Harris.
Flagstar Bank
Good customer satisfaction
- HELOC APR: 8.49% to 21% (0.25% autopay discount included)
- Introductory APR: 6.75% for first six months
- Loan amount: $10,000 to $1 million
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 89.99%
Flagstar Bank offers home equity loans and HELOCs in 49 states (all but Texas). We like the lender’s range of customer service options, including 24-hour loan support via phone, which may appeal to those who enjoy accessible communication with customer service. Flagstar’s nationwide availability also stood out to us. Its tedious application process and lack of price transparency may be a drawback for people seeking a quick, easy process.
Read CNET’s review of Flagstar Bank.
Truist
Good fast funding option
- HELOC APR: 7.5% to 15%
- Introductory APR: 5.99% for first nine months
- Loan amount: From $10,000
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 85%
Truist offers standard, interest-only and rate-lock HELOCs to borrowers in 15 states, primarily in the Southeast. Truist doesn’t offer home equity loans. HELOC line amounts start at $10,000 on up. Truist’s fast funding stands out to us. Truist falls short on price transparency. You’ll have to submit an application and undergo a credit check to get personalized rates.
Read CNET’s review of Truist.
Figure
Lump-sum HELOC offering
- HELOC APR: From 7.05%
- Loan amount: $15,000 to $400,000
- HELOC terms: Five, 10, 15 or 30 years
- Maximum LTV ratio: 95%
Figure provides HELOCs in 44 states. Although officially called a HELOC, Figure’s HELOC has characteristics of both a traditional HELOC and a home equity loan. Borrowers will withdraw the full line amount (minus the origination fee) at the time of origination. Once they repay the initial balance at a fixed rate, they will be able to make additional draws over a specified period. Figure’s main draws are its fast funding and easy-to-navigate website with an accompanying chatbot. Figure only offers a single product, which might not be right for everyone.
Read CNET’s review of Figure.
PenFed Credit Union
Good option for borrowers outside the continental US
- HELOC APR: From 7.375%
- Loan amount: $25,000 to $1 million
- HELOC terms: 10-year draw period, 20-year repayment period
- Maximum LTV ratio: 90%
PenFed offers HELOCs in all 50 states, as well as Guam, Puerto Rico and Okinawa. PenFed is a credit union so its products are only available to members, but you can easily become a member. With PenFed, you can choose between a standard, interest-only or rate-lock HELOC with line amounts running from $25,000 to $1 million. PenFed doesn’t offer home equity loans. PenFed may be a good option for borrowers in US territories who don’t have many other alternatives when it comes to home equity lenders. However, PenFed’s application process is more tedious than that of other lenders, requiring applicants to request a callback from the credit union.
Read CNET’s review of PenFed.
HELOC Basics
A HELOC is considered a second mortgage. It’s a loan taken out against your home while your original mortgage is still being paid off.
A home equity line of credit, or HELOC, is a type of revolving credit similar to a credit card, but that’s secured by your home. You’ll be able to access funds from your HELOC as you need them, instead of taking out a set amount at the onset, like with a home equity loan. There’s usually a minimum withdrawal amount based on the total amount of your credit line.
HELOCs are commonly used for home improvements, such as adding solar panels , as well as debt consolidation and other large expenses. There are no restrictions on how you use the money from a HELOC.
HELOC, but there’s always a risk in taking on debt that’s tied to your home.HELOCs typically have variable-rate APRs, meaning your interest rate adjusts over time based on the benchmark US prime rate. The prime rate is the base rate on corporate loans posted by at least 70% of the 10 largest US banks, according to the Wall Street Journal.
Similar to a home equity loan, a HELOC lets you borrow against the percentage of your home that you’ve fully paid off. Since your home serves as collateral for the loan, it’s important to have a repayment plan in place so you don’t lose your property.
HELOCs are typically divided into two periods: a draw period and a repayment period. During the draw period (often 10 years), you can take funds from your HELOC up to the amount of your credit line. With interest-only HELOCs, you’re required to make monthly payments toward the accrued interest, not the principal, during the draw period.
Once the draw period is over, you can no longer withdraw money, and you’ll enter the repayment period, where you begin paying back both principal and interest. While terms may vary by lender , the draw period typically lasts five to 10 years, while the repayment period usually lasts 10 to 20 years.
Who qualifies for a HELOC?
To qualify for a HELOC you’re typically required to meet the following criteria:
- Have at least 15% to 20% equity built up in your home: Home equity is the amount of home you own, based on how much you’ve paid toward your mortgage. Subtract what you owe on your mortgage and other loans from the current appraised value of your house to figure out your home equity number.
- Have adequate, verifiable income and stable employment: Proof of income is a standard requirement to qualify for a HELOC. Check your lender’s website to see what forms and paperwork you will need to submit along with your application.
- Have a minimum credit score of 620: Lenders use your credit score to determine the likelihood that you’ll repay the loan on time. Having a strong credit score -- at least 700 -- will help you qualify for a lower interest rate and more amenable loan terms.
- Have a debt-to-income ratio of 43% or less: Divide your total monthly debts by your gross monthly income to get your DTI. Like your credit score, your DTI helps lenders determine your capacity to make consistent payments toward your loan. Some lenders prefer a DTI of 36% or less.
Pros and cons of a HELOC
Pros
- HELOCs usually have lower interest rates than other financing options like personal loans or credit cards.
- You can withdraw funds anytime during the draw period and only have to pay for the amount of money you use, plus interest.
- HELOCs have very few restrictions on what the money can be used for.
- Lenders often offer discounted rates for an introductory rate period.
Cons
- Because HELOCs are secured by your house, you could lose your home if you default on your debt.
- HELOCs can have a minimum withdrawal amount.
- The interest rate is variable, so your rate and monthly payment could increase unexpectedly.
- HELOCs could come with annual fees, application fees, appraisal fees and other closing costs, depending on the lender.
How to apply for a HELOC
Applying for a HELOC is similar to applying for a mortgage. Before you do so, make sure you qualify for the loan amount you need and that you meet basic requirements: at least 15% to 20% equity in your home, a good credit score and a low combined loan-to-value ratio (the ratio of all of your outstanding mortgage balances compared to the market value of your property).
1. Determine your LTV ratio
Your lender will calculate the amount of equity in your home to determine your loan-to-value ratio, which expresses how much you still owe on your home’s mortgage compared to its current appraised value. Generally, your LTV should be less than 80% and no higher than 90% to qualify. Having a high LTV tells a lender you may be a risky borrower.
Here‘s the basic formula:
To calculate the equity in your home: Look up your outstanding mortgage balance and subtract it from your home’s appraised value. For example, if your home is currently worth $500,000 and you have $400,000 left to pay on your mortgage, then you have $100,000 of equity in your home.
To determine your loan-to-value ratio: Divide your current mortgage balance by your home’s appraised value. If you owe $400,000 on a $500,000 home, the calculation would be:
$400,000 [outstanding mortgage balance] / $500,000 [current appraised value] = 0.80
Then multiply that answer by 100 to get your LTV ratio expressed as a percent. In this example, you have an 80% LTV ratio.
2. Determine your HELOC credit limit
Most lenders will let you borrow in the neighborhood of 75% to 90% of your home’s value, minus what you owe on your primary mortgage. To determine whether you’ll hit that threshold, you can use the below formula, which assumes a lender will allow you to borrow up to 85% of your home equity:
$500,000 [current appraised value] X 0.85 [maximum equity percentage you can borrow] – $400,000 [outstanding mortgage balance] = $25,000 [what the lender will let you borrow]
3. Reach out to lenders
It’s important to interview multiple lenders when you want to use your home equity for financing. The more banks and lenders you contact, the better your chances of finding more favorable rates and fees overall. You can start with the lender or bank that issued your first mortgage, since they’ve already approved you for one loan and you have an existing relationship. You might also compare rates from online lenders.
4. Send in your application
Once you’ve chosen a lender, gather all of your financial documentation to verify you can pay back the HELOC. You’ll need proof of income and employment, and in some cases, you may need to pay for a new home appraisal to assess the current market value of your property.
After all your financial paperwork is submitted, the final step is to close on the loan, which can take anywhere from 30 to 60 days depending on the lender.
Tips for comparing multiple HELOC offers
The offers you receive will vary from lender to lender, but the more you know about the specific ins and outs of those offers, the better your chances of saving money and interest. There are a few major factors to consider when deciding which HELOC offer to go with.
Introductory rate period
Since HELOCs have variable interest rates tied to the prime rate, your interest rate will go up and down over time. Be aware of what the prime rate is and know that you’ll be paying a markup on that interest rate.
In the beginning, most HELOCs come with a lower introductory rate period, but the length of those initial rates will differ by lender, and you want to find the longest one possible. The longer you have a lower interest rate, the more money you’ll save over time. There are also some lenders who allow you to fix your interest rate for a portion of the loan, which offers a more predictable payment.
Rate cap
Ask about your maximum HELOC interest rate cap. HELOCs have lifetime interest rate caps, so even if the prime rate rises and surpasses your rate cap, your HELOC rate won’t increase any further. If you have an existing HELOC, you can attempt to negotiate a lower rate with your lender.
“Ask your current HELOC lender if they will fix the interest rate on your outstanding balance,” said Greg McBride, chief financial analyst at Bankrate, CNET’s sister site. “Some lenders offer this, many do not. But it is worth asking the question.”
Minimum withdrawals
Some lenders require minimum withdrawals regardless of your total line of credit. You don’t want to get stuck making interest payments on funds you don’t actually need if that amount is less than the mandatory minimum withdrawal amount set by your lender. It’s also important to know when your draw period ends so you can afford the larger principal-plus-interest payments once you enter your repayment period.
Alternatives to a HELOC
- Home equity loans are another type of home equity financing. With a home equity loan, you take out a one-time loan with a set amount, loan term and interest rate, then pay it back in monthly installments. A home equity loan works like a personal loan except it is secured by your home, just like a HELOC.
- Cash-out refinances are also a common way to tap into your home equity for cash, but they work differently than a HELOC or home equity loan. While a HELOC or home equity loan acts as a second mortgage on your home, a cash-out refinance replaces your current mortgage with a new one. With a cash-out refi, you’ll take out a mortgage with a larger loan amount than your current one, use it to pay off your existing mortgage and pocket the difference as cash.
- Personal loansare a good option if you want to avoid putting your home up as collateral. However, personal loans tend to have higher interest rates than HELOCs and home equity loans.
Methodology
We evaluated a range of lenders based on factors such as interest rates, APRs and fees, how long the draw and repayment periods are, and what types and variety of loans are offered. We also took into account factors that impact the user experience such as how easy it is to apply for a loan online and whether physical lender locations exist.
FAQs
A good HELOC rate is considered anything at or below the national average. As of April, average HELOC interest rates are in the low-8% range.
Some lenders advertise even lower interest rates, but those rates are typically available only to borrowers with excellent credit and an LTV ratio below 80% (often close to 60% or 70%). Getting a better rate could depend on your financial situation, including your credit score , income level, debt-to-income ratio and how much equity you have in your house.
HELOCs can be useful for large expenses , like home renovations , medical emergencies or college tuition. They’re particularly good for ongoing expenses because you’ll only need to pay back what you spend during the draw period.
A HELOC can be a good option if you have big expenses coming up that you need cash to cover. If you’re unsure how much money you’ll need and don’t need all the funds upfront, a HELOC gives you plenty of flexibility. An added advantage is that current HELOC rates are comparatively lower than other types of financing, like personal loans or credit cards. But if you’re unsure you’ll be able to comfortably repay the loan, a HELOC isn’t worth the risk of losing your home.
While HELOCs are variable-rate revolving lines of credit, home equity loans are fixed-rate installment loans. With a home equity loan, you get a sum of money when you take out the loan and pay it back (with interest) in fixed monthly payments.
With a HELOC, you can draw from a line of credit as much as you want, whenever you want during the draw period and pay it back with interest during the repayment period. Your monthly payment will depend on how much you draw and the current interest rate on your HELOC.
The interest rates you’ll get for either loan are determined by your credit score, home equity, where you live, your property’s value and other factors.
