Home Equity Line of Credit Rates Dropping Below 7.5% Nationally
Nationally, the average home equity line of credit interest rate is below 7.5% and falling, according to Curinos, an analytics company. Lenders are adjusting their pricing to reflect the new, lower prime rate of 6.75%. This shift in rates is great news for homeowners looking to access the equity in their homes.
According to Curinos data, the average weekly HELOC rate stands at 7.44%. This rate is based on applicants with a minimum credit score of 780 and a maximum combined loan-to-value ratio (CLTV) of 70%.
The Federal Reserve reports that homeowners had nearly $36 trillion in home equity at the end of the second quarter of 2025, marking the largest amount of home equity on record.
With mortgage rates still above 6%, homeowners are hesitant to give up their primary mortgages. This reluctance makes selling a house or opting for a cash-out refinance less appealing. Why let go of a low-rate mortgage when you can access your home equity through a HELOC?
HELOC interest rates differ from primary mortgage rates as they are based on an index rate plus a margin. Typically, the prime rate serves as the index, which currently sits at 6.75%. Adding a margin of 0.75% would result in a HELOC rate of 7.50%.
Lenders have pricing flexibility when it comes to second mortgage products like HELOCs or home equity loans. Shopping around for the best rates is essential, as your rate will depend on factors like your credit score, existing debt, and the credit line compared to your home’s value.
It’s important to note that average national HELOC rates may include introductory rates that last for a limited time before transitioning to an adjustable rate, likely at a higher percentage.
The beauty of a HELOC lies in its ability to tap into your home equity as needed while keeping your primary mortgage intact. The best HELOC lenders offer low fees, fixed-rate options, and generous credit lines, allowing you to access and repay your equity at your own pace.
LendingTree is currently offering a HELOC APR as low as 6.38% on a credit line of $150,000. However, remember that HELOCs typically come with variable interest rates, so be prepared for fluctuations in your rate and monthly payments.
When considering a HELOC, compare fees, repayment terms, and the minimum draw amount required by lenders. The flexibility of a HELOC allows you to borrow only what you need and leave the rest of your credit line available for future use, saving you money on interest charges.
Rates for HELOCs can vary significantly from one lender to another, ranging from below 6% to as high as 18%. Your creditworthiness and diligence as a borrower will play a significant role in securing a favorable rate.
For homeowners with low primary mortgage rates and substantial home equity, now is an opportune time to consider a HELOC. You can use the funds drawn from your equity for home improvements, repairs, upgrades, or even leisure activities like vacations, as long as you have a plan to repay the balance promptly.
If you max out a $50,000 line of credit at a 7.50% interest rate, your monthly payment during the 10-year draw period would be around $313. It’s crucial to remember that HELOC rates are typically variable, so your payments will increase over the 20-year repayment period. To make the most of a HELOC, aim to borrow and repay the balance within a shorter timeframe, rather than stretching it out over 30 years.
In conclusion, with HELOC rates dropping below 7.5% nationally, homeowners have a valuable opportunity to access their home equity at favorable terms. By understanding the intricacies of HELOCs and comparing offers from different lenders, you can make informed decisions to leverage your home equity effectively.
