Interest rates on home equity lines of credit (HELOCs) and home equity loans are near one-year lows, with potential for rates below national averages. The average HELOC rate is 7.23%, while a home equity loan averages 7.44%. Homeowners with low primary mortgage rates may struggle to access their home’s increasing value.

The Federal Reserve estimates $34 trillion of locked equity in U.S. homes, offering a solution through second mortgages like HELOCs or HELs. Rates for second mortgages are based on an index rate plus a margin. Shopping around can help determine your rate based on credit score and other factors.

HELOCs offer flexibility with introductory rates that may adjust after a short period. In contrast, HELs provide a fixed rate for the agreement’s duration. Both options allow homeowners to access equity without sacrificing their low-rate primary mortgage.

The best HELOC lenders offer low fees, fixed-rate options, and generous credit lines. LendingTree currently offers a HELOC APR as low as 6.13% on a $150,000 credit line. It’s important to note that HELOCs typically have variable interest rates, so budget accordingly for potential rate fluctuations.

The best home equity loan lenders can provide a fixed rate for the repayment period, simplifying financial planning. HELOC rates may vary between lenders, ranging from below 6% to as high as 18%, depending on creditworthiness. Compare fees and repayment terms for the best loan option.

For homeowners with low primary mortgage rates and substantial equity, now may be an ideal time to consider a HELOC or home equity loan. These options allow access to equity without affecting mortgage rates, enabling funding for home improvements or repairs.

HELOCs offer flexibility but may require careful budgeting due to variable rates. For example, withdrawing $50,000 at 7.50% interest could result in a $313 monthly payment during the draw period. Payments may increase during the repayment period, making HELOCs ideal for short-term borrowing and repayment.

Read more at Yahoo Finance: HELOC and home equity loan rates Sunday, February 8, 2026: Get a better-than-average rate