HELOC interest rates are holding steady, but may drop if the Federal Reserve cuts rates next month. Bank of America reports an average APR of 8.72% on 10-year draw HELOCs. Homeowners hold over $34 trillion in home equity, making it a valuable asset.

With mortgage rates around 6%, homeowners are hesitant to sell. HELOCs offer an option to tap into home equity without affecting primary mortgage rates. Second mortgage rates, like HELOCs, are based on an index rate plus a margin.

National HELOC rates may include introductory rates that increase after a set period. Keeping a low-rate mortgage allows homeowners to access equity through a second mortgage, like a HELOC. The best HELOC lenders offer low fees, fixed-rate options, and flexibility in credit line limits.

FourLeaf Credit Union offers a 6.49% introductory HELOC rate for 12 months on lines up to $500,000. HELOCs allow for borrowing only what is needed, with interest only on the amount borrowed. Rates can vary greatly between lenders, so it’s essential to shop around.

For homeowners with low primary mortgage rates and substantial equity, now is an excellent time to consider a HELOC. HELOCs provide cash for home improvements and other expenses without affecting primary mortgage rates. It’s crucial to pay off HELOC balances promptly to avoid long-term debt.

Borrowing $50,000 from a $400,000 home’s equity may result in a $395 monthly payment with a variable interest rate starting at 8.75%. HELOCs with a 10-year draw period and a 20-year repayment period can help, but it’s best to pay off the balance quickly.

Read more at Yahoo Finance: Get a low interest rate now, then look for the Fed to cut rates later