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LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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Current Home Equity Loan Rates
LOAN AMOUNT | APR AS LOW AS |
$25,000 | 6.63% |
$50,000 | 6.63% |
$100,000 | 6.88% |
$150,000 | 6.88% |
Rates are calculated based on conditional offers for both home equity loans and home equity lines of credit with 30-year repayment periods presented to consumers nationwide by LendingTree’s network partners in the past 30 days for each loan amount. Rates and other loan terms are subject to lender approval and not guaranteed. Not all consumers may qualify. See LendingTree’s Terms of Use for more details.
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Written byRene Bermudez| Edited byCrissinda Ponder | Updated February 27, 2024
How to get the best home equity loan rates
There are many home equity loan lenders to choose from, and each of them set their own approval guidelines. The guidelines are usually a bit more strict than traditional mortgages, so you should strive to:
- Boost your credit score. The lowest score that most home equity lenders accept is 620, but others may set their minimums at 660 to 680. The higher your credit score, the better your home equity loan interest rate will be.
- Reduce your DTI ratio. Lenders divide your total debt, including your new home equity loan, by your pretax income to find your debt-to-income (DTI) ratio. The DTI limit is usually 43%, but a lower DTI could snag you a better rate.
- Borrow less of your home’s value. The typical maximum loan-to-value (LTV) ratio is 85%, but lenders offer better rates if you borrow a smaller amount, which is less of your home’s value.
- Avoid second home or investment property home equity loans. The best home equity loan rates go to homeowners that live in their home as a primary residence.
- Shop around. Home equity lenders may offer special incentives to earn your business, like discounted rates if you have other deposit or credit accounts with them. Compare the costs and rates from at least three lenders to ensure you’re getting the best deal. You can start by reviewing our choices for the best home equity lenders below.
Can I get a home equity loan with bad credit?
Can I get a home equity loan with bad credit?It’s possible to get a home equity loan with bad credit, but you may not qualify for as much equity as you need or want. Lenders may reduce your maximum LTV ratio and charge you a significantly higher interest rate. If your scores are below 620, consider a government-backed program like an FHA cash-out refinance or VA cash-out refinance.
The best home equity lenders of 2024
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
| Lender | LendingTree rating | Available features | Lender review |
|---|---|---|---|
 Best for low credit scores | 680 minimum credit score 90% LTV with higher score $45K minimum draw | Read our review | |
 Best for high LTV ratios | 5- to 30-year terms No-closing-cost options 100% LTV for qualified borrowers | Read our review | |
 Best for online experience | 5- to 30-year terms $10K to $500K loan amounts 0.25% rate discount for eligible borrowers | Read our review | |
| Best for rate and closing cost discounts | 5- to 30-year terms 0.50% rate discount for eligible borrowers No upfront fees | Read our review |
| Best for fast closings | 5- to 30-year terms $500K maximum loan amount 14-day closings possible | Read our review |
Read more about how we chose our best home equity lenders.
Best home equity loan for low credit scores: Rocket Mortgage
| Available home equity loan terms | Home equity loan features | LendingTree rating |
|---|---|---|
|
| Read review |
Rocket Mortgage offers a home equity loan for borrowers with credit scores as low as 680, though you’ll need at least a 760 score to borrow up to a 90% LTV. Rocket also offers the option to combine your first and second mortgage with a cash-out refinance.
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Best home equity loan for high LTV ratios: Navy Federal Credit Union
| Available home equity loan terms | Home equity loan features | LendingTree rating |
|---|---|---|
|
| Read review |
Navy Federal Credit Union is the only lender we reviewed that allows qualified homeowners to borrow up to 100% of their home’s value. Military borrowers may be eligible for extra discounts and a streamlined approval process. Customer support can be contacted online, by phone or even on X (formerly Twitter). The website also provides a step-by-step guide to help you understand the timeline of your home equity loan.
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Best home equity loan for online experience: TD Bank
| Available home equity loan terms | Home equity loan features | LendingTree rating |
|---|---|---|
|
| Read review |
TD bank’s website is streamlined and easy to use, with a rate tool that customizes options based on your location. Terms range from five to 30 years and rate information is simple to find. TD Bank offers borrowers a 0.25% interest rate discount for its home equity loan products if you open a TD bank checking or savings account with automatic payment deductions. An added bonus: A TD Bank home equity loan can be secured by an investment property — most home equity lenders only allow you to borrow against your primary residence.
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Best home equity loan for rate and closing cost discounts: BMO Harris
| Available home equity loan terms | Special home equity loan features | LendingTree rating |
|---|---|---|
|
| Read review |
BMO Harris offers the highest discounts on home equity loan rates of any lender we reviewed. They offer loans with terms that range from five to 20 years. You can check rates online, browse detailed information about loan programs and even watch mortgage-related videos on their website. There’s also an online application and a guide to help you through the process.
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Best home equity loan for fast closings: Spring EQ
| Available home equity loan terms | Home equity loan features | LendingTree rating |
|---|---|---|
|
| Read review |
Spring EQ is the only lender we reviewed that specializes exclusively in home equity loan products. You can also borrow up to 95% of your home’s value — much more than the max 85% LTV most lenders offer. Homeowners can convert equity to cash in as little as 14 days, although 21 days is the average, according to Spring EQ’s website.
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What is a home equity loan?
A home equity loan is a second mortgage that converts your home equity into cash. Home equity is the difference between how much your home is worth and the amount you owe on your outstanding mortgage balance.
When you get a home equity loan, you receive the money all at once and make fixed monthly payments to pay it off. You can use the cash from a home equity loan to make home improvements, pay down high-interest debt or cover any other expense you choose.
See how much you could borrow with a home equity loan calculator.
On this page
- What is a home equity loan?
- How do home equity loan rates work?
- How home equity loan rates are determined
- Pros and cons
- How to calculate my home equity loan amount
- What can I use a home equity loan for?
- Alternatives to home equity loans
- Frequently asked questions
Is a home equity loan tax deductible?
Yes, if the funds from the home equity loan are used for home improvements, you can deduct the interest from your taxable income. Learn more about how to get your home equity loan tax deductible.
How do home equity loan interest rates work?
Most home equity loans come with fixed interest rates, which means that you can enjoy consistent payments that won’t change over time. Because a home equity loan is paid out to you all at once, the amount of money you’re paying interest on never changes.
Home equity loan requirements
To get a home equity loan, you’ll need to meet the following home equity loan requirements:
- DTI ratio: 43% maximum
- Credit score: 620 minimum
- LTV ratio: 85% maximum
*This is the standard LTV ratio maximum. However, some home equity lenders let you borrow up to 100% of your home’s value.
How are home equity loan rates determined?
- Your credit score. The lower your credit score, the better your rate will usually be. Most lenders will allow a 620 minimum score, but some set the bar even higher at 660 or 680.
- Your debt-to-income (DTI) ratio. Your DTI ratio measures how much your monthly debt load is compared to your gross monthly income. Home equity lenders typically allow a 43% maximum DTI ratio, but the lower the ratio is, the better your rate offers will be.
- Your loan-to-value (LTV) ratio. Your LTV ratio compares how much you’re borrowing to your home’s value. Lenders see a lower LTV ratio as less risky so they can offer lower rates. Most lenders limit you to a maximum LTV of 85%, but there are some lenders who offer high-LTV home equity loans with LTVs of up to 100%.
Pros and cons of home equity loan rates
| Pros | Cons |
|---|---|
Lower interest rates: You’ll pay lower interest rates than you would with credit cards or personal loans. Fixed rates: Your payment will be the same each month because your rate doesn't change. Tax implications: You may be able to deduct home equity loan interest from your tax bill. One-time closing costs: Your closing costs will typically be on par with HELOC closing costs, but you won’t have any ongoing membership or inactivity fees. Very flexible: You can use the money for any purpose. | Second mortgage rates: You’ll pay a higher rate than with a HELOC or cash-out refinance. Tougher guidelines: You may need higher scores and lower debt to qualify than you would with a cash-out refinance. Reduced equity: You’ll lower the available equity in your home. Another monthly payment: You’ll have two monthly house payments. Collateral requirement: You could lose your home if you default on your payments. |
Learn more about home equity loan pros and cons.
Think a home equity loan is right for you? Compare Top Lenders and Rates
How do I calculate my home equity loan amount?
The easiest way to figure out how much you can borrow with a home equity loan is to let our home equity loan calculator do the math for you. You’ll just need three pieces of information:
- An estimate of your home’s value
- Your current mortgage balance
- Your current credit score
Note: The results are based on a maximum 85% LTV ratio.
If your lender uses a different maximum LTV ratio, you may want to do the calculation by hand. Here’s how:
- Divide your lender’s maximum LTV percentage by 100
- Multiply that number by your home’s value
- Subtract how much you owe on your first mortgage from the number you got in Step 2
For example, let’s say your lender allows a 95% LTV ratio and you have a $400,000 home with a $90,000 mortgage balance. You’d multiply 0.95 by $400,000 to get $380,000. You’d then subtract $90,000 from $380,000 to arrive at your home equity loan amount of $290,000.
What can I use a home equity loan for?
You can use home equity loans for just about anything, including:
- Completing home renovations and energy-efficient upgrades
- Debt consolidation to clear out high-interest-rate credit card balances
- Buying a rental property
- Expanding or starting a business
- Avoiding mortgage insurance with a piggyback loan
Ready to tap your home equity?Compare Free Rates Offers
Alternatives to home equity loans: Which has the best rates?
Home equity loan rates vs. HELOC rates
→ HELOC rates are usually slightly lower than home equity loan interest rates.
Consumers sometimes confuse home equity loans with home equity lines of credit (HELOCs), but they work very differently. A HELOC is a line of credit that can be used like a credit card, and they almost always come with variable rates.
| A HELOC is best if: | A home equity loan is best if: |
|---|---|
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See current HELOC rates and top lenders today.
Home equity loan rates vs. cash-out refinance rates
→ Cash-out refinance rates are usually lower than home equity loan interest rates.
A cash-out refinance gives you access to cash by replacing your existing mortgage with a larger one. Because it’s a first mortgage, you can access that cash at lower interest rates than you could with second mortgages, like HELOCs and home equity loans. A cash-out refi also has more lenient requirements overall than a home equity loan, making it easier to qualify for. For example, you could get an FHA cash-out refinance with a credit score as low as 500.
| A home equity loan is best if: | A cash-out refinance is best if: |
|---|---|
|
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Learn about cash-out refinance options.
Home equity loan rates vs. personal loan rates
→ Personal loan rates are usually higher than home equity loan interest rates.
If you prefer to leave your home equity alone, you may qualify for an unsecured personal loan. The rates are often higher than home equity products, but you won’t have to worry about the lender foreclosing on your home if you default on your payments.
| A home equity loan is best if: | A personal loan is best if: |
|---|---|
|
|
See top lender personal loan rates today.
Frequently asked questions
Although most home equity lenders let you tap up to 85% of your home’s value, some lenders may offer high-LTV home equity loans that allow you to borrow more. Use our home equity loan calculator to estimate your home equity borrowing power.
It may take two to four weeks to close on a home equity loan. You’ll usually receive your funds following a three-business-day waiting period after your closing.
Home equity loan rates are often higher than interest rates on traditional mortgages. Usually, the more you borrow, the higher your rate will be. Your credit score and loan term also have an impact on the rate you’re offered.
Yes, a home equity loan is often called a second mortgage, since it’s usually attached to a home already secured by a first mortgage. If you default on the loans secured by the home and go into foreclosure, the home equity loan will be second in line to be repaid.
Related Resources
How we chose our picks for the best home equity loan lenders
To determine the best home equity loan lenders, we reviewed data collected from 35 lender reviews completed by the LendingTree editorial staff in 2023.
Each lender review gives a rating between zero and five stars, based on several factors including loan features and loan variety, digital application processes and the availability of product and lending information online. To be eligible for the “best of” home equity loan title, lenders must have a lender review rating of at least four stars. To be considered for our “best overall” pick, lenders must issue mortgages in at least 35 states.
We awarded extra points to lenders that:
- Publish home equity loan rates online
- Provide detailed information about one or several different home equity loan options
- Offer a loan-to-value (LTV) ratio above the 85% industry standard
- Offer fast closing options
- Offer products with rate discounts or no closing costs
Our editorial team brought together the data from our lender reviews, as well as the scores awarded for home equity-specific characteristics, to find the lenders with a product mix, information base and guidelines that best serve the needs of home equity loan borrowers.
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