Rates for home equity lines of credit (HELOC) and home equity loans are currently at their lowest point of 2025, making monthly payments more affordable as homeowners access record levels of home value. The national average monthly HELOC rate is 7.44%, while the average rate for a home equity loan is 7.59%, based on applicants with a credit score of 780 and a CLTV of 70%.

Homeowners have nearly $36 trillion in home equity, the highest amount ever reported by the Federal Reserve. With mortgage rates near 6%, homeowners are holding onto their primary mortgages and considering accessing their home equity through options like a second mortgage.

Home equity interest rates are different from primary mortgage rates, with second mortgage rates being based on an index rate plus a margin. Lenders have flexibility with pricing on HELOCs and home equity loans, so it’s important to shop around based on credit score, debt amount, and credit line compared to home value.

HELOC rates can include introductory rates that may increase later, while home equity loans have fixed rates. The best HELOC lenders offer low fees, fixed-rate options, and generous credit lines. When shopping for lenders, be aware of both introductory and variable rates.

FourLeaf Credit Union currently offers a HELOC rate of 5.99% for 12 months on lines up to $500,000, converting to a variable rate of 7.25% later. Finding the best home equity loan lenders can be easier, as fixed rates last the length of the repayment period, providing a lump sum without draw minimums.

Rates vary significantly among lenders, with the national average for HELOC at 7.44% and home equity loan at 7.59%. Considering a HELOC or home equity loan now allows homeowners to access cash for various purposes without giving up their low primary mortgage rates.

If you withdraw $50,000 from a HELOC at a 7.50% interest rate, your monthly payment during the 10-year draw period would be around $313. However, with a variable rate, payments will increase during the 20-year repayment period, essentially turning the HELOC into a 30-year loan.

Read more at Yahoo Finance: Payments drop as rates hit 2025 lows