From Yahoo Finance: 2025-06-21 06:00:00

HELOC interest rates dropped, enticing borrowers to tap home equity. 30% of homeowners plan to access equity in the next 12 months for home improvements. Zillow reports 10-year HELOC rates at 6.70%. VA-backed rates fell to 6.30%. Homeowners have over $34 trillion in home equity, a record high.

HELOC rates are separate from primary mortgage rates. Rates are based on an index rate plus a margin, often the prime rate. Lenders have flexibility in pricing, based on credit score, debt amount, and credit line value. Introductory rates may adjust after initial period.

Best HELOC lenders offer low fees and fixed-rate options. HELOC provides flexibility to use home equity as needed, paying down primary mortgage while accessing equity. FourLeaf Credit Union offers 6.49% introductory rate. Rates vary, so compare lenders for best terms.

HELOC allows tapping needed funds while leaving credit line available for future needs. Interest only on borrowed amount. Rates range from 7%-18% based on creditworthiness. Good time for homeowners with low mortgage rates and equity to get HELOC for home improvements or other needs.

Full $50,000 draw on $400,000 home may have $395 monthly payment at 8.75% variable rate. HELOC with 10-year draw and 20-year repayment period can stretch to 30-year loan. Best for short-term borrowing and repayment. Use HELOC wisely for maximum benefit.

Read more: The home equity line of credit rate sharply lower