Throughout this year, HELOC rates have seen a steady decline. As of now, the average home equity line of credit interest rate sits at 7.75%, according to data from the analytics firm Curinos. This reflects a decrease of three basis points over the past week, with a total reduction of 19 basis points in the last three months.
Data from Curinos indicates that the average weekly HELOC rate stands at 7.75%, marking its lowest level in 2025. This figure is applicable to applicants with a credit score of at least 780 and a maximum combined loan-to-value ratio (CLTV) capped at 70%.
According to the Federal Reserve, homeowners had over $34 trillion in home equity at the end of 2024, representing the third-highest level of home equity on record.
With mortgage rates remaining above 6%, many homeowners are reluctant to part with their primary mortgage, making selling a house or pursuing a cash-out refinance less appealing. Why abandon a 5%, 4% or even 3% mortgage?
Leveraging that equity through a flexible HELOC can be a smart move.
It’s important to note that HELOC interest rates differ from those of primary mortgages. Rates for second mortgages are typically determined by an index rate plus a margin. The prime rate currently stands at 7.25%, so if a lender adds a 1% margin, the HELOC would be set at 8.25%.
When it comes to second mortgage rates, lenders often offer flexibility, allowing you to shop around for better options. Your interest rate will hinge on factors such as your credit score, outstanding debt, and the proportion of your credit line to your home’s value.
Additionally, average national HELOC rates may include “introductory” offers that could only last for a period of six months to a year. Once this period concludes, your interest rate could become adjustable, likely increasing significantly.
You can maintain your low-rate mortgage while accessing your home equity. Keep your primary mortgage intact and consider a second mortgage, such as a HELOC.
The leading HELOC lenders provide low fees, fixed-rate options, and generous credit limits. A HELOC gives you the flexibility to utilize your home equity as needed, withdrawing and repaying at your convenience within your credit line limit. You can borrow some funds, repay them, and borrow again.
Throughout this process, you’ll continue paying down your favorable primary mortgage, maximizing your wealth.
Currently, LendingTree lists a HELOC APR as low as 6.49% for a credit line of $150,000. Keep in mind that HELOCs generally come with variable interest rates, which means your payment rates might change over time. Ensure you can handle increased monthly payments if rates go up.
Always compare fees, repayment options, and the minimum amount required from your lender. The minimum draw refers to the initial amount a lender mandates you take from your equity.
A HELOC’s strength lies in the ability to draw only what you need, keeping your remaining credit line accessible for future use. You won’t incur interest unless you borrow.
Interest rates vary significantly among lenders, making it challenging to pinpoint an exact figure. Rates can range from slightly below 6% to as much as 18%, depending chiefly on your creditworthiness and how well you shop around for the best deal.
For homeowners who possess low primary mortgage rates and have considerable equity, this might be an ideal time to explore a HELOC. You won’t compromise your attractive mortgage rate, and you can use the funds extracted from your equity for various purposes such as home renovations, repairs, and upgrades. Of course, a HELOC can also finance enjoyable expenses like vacations, given you have the discipline to repay promptly, ensuring you don’t incur long-term debt unnecessarily.
If you were to fully withdraw $50,000 from your credit line at a 7.75% interest rate, your payment during the 10-year draw period would hover around $323. While this may seem appealing, remember that the interest rate is typically variable, leading to higher payments when your 20-year repayment period begins. Essentially, a HELOC operates like a 30-year loan. They work best if you borrow and repay the balance sooner rather than later.
