ӣƵ

BLUEPRINT

Advertiser Disclosure

Editorial Note: Blueprint may earn a commission from affiliate partner links featured here on our site. This commission does not influence our editors' opinions or evaluations. Please view our full advertiser disclosure policy.

The best home equity line of credit (HELOC) rates are low compared to the national average, with lenders offering additional perks like introductory annual percentage rates (APRs), rate discounts and the option to convert from a variable-rate to a fixed-rate HELOC. Here are our picks for the best HELOC rates in 2024.

Best HELOC rates

Why trust our mortgage experts

Our team of experts evaluated hundreds of mortgage products and analyzed thousands of data points to help you find the best fit for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.

  • 18 mortgage lenders reviewed.
  • 180 data points analyzed.
  • 6-stage fact-checking process.

Compare the best HELOC rates

 INTEREST RATES30-YEAR LOAN TERMS (YEARS)FIXED-RATE OPTION AVAILABLE
Bank of America

Below national average
(introductory rate)

Draw period: 10
Repayment period: 20

Yes
U.S. Bank
Above national average

Draw period: 10
Repayment period: 10, 15 or 20

Yes
Connexus Credit Union

Below national average
(introductory rate)

Draw period: 15
Repayment period: 15

No
Flagstar Bank
Above national average

Draw period: 10
Repayment period: 20

No
PenFed
Below national average

Draw period: 10
Repayment period: 20

Yes

Methodology

Our expert writers and editors have reviewed and researched multiple lenders to help you find the best HELOC. Out of all the lenders considered, the five that made our list excelled in areas across the following categories (with weightings): loan details (20%), loan cost (40%), eligibility and accessibility (20%) and customer experience (20%).

Within each major category, we considered several characteristics, including APR, maximum combined loan-to-value (CLTV) ratio and whether the lender offers a promotional introductory rate. We also evaluated each provider’s customer support options, borrower perks and more.

Why some lenders didn’t make the cut

Of the HELOC lenders that we reviewed, only a fraction made the cut. The lenders that didn’t have high enough scores to be included received lower ratings mostly due to a lack of transparency around eligibility details.

What is a home equity line of credit?

A HELOC is a type of second mortgage that lets you borrow against the equity that you’ve built up in your home. When you get a HELOC, you’ll have access to a revolving credit line that you can draw from as needed. 

Like with other kinds of mortgages, a HELOC is a secured loan that uses your home as collateral. This means there’s a risk of foreclosure if you can’t make your payments.

How does a HELOC work?

HELOCs have a draw period and a repayment period. During the draw period — which is typically 10 years — you can borrow from your line of credit for almost any expense, such as home improvements or debt consolidation. Generally, you’ll have to make monthly payments during your draw period. These can be interest-only payments or a percentage of the amount you’ve borrowed, depending on the lender. You also have the option to make payments toward the principal balance, which will reduce your balance and add funds back to your credit line.

Once the draw period ends, you’ll enter your repayment period, which is usually 20 years, depending on the lender. During this time, you’ll make monthly principal and interest payments toward the total borrowed until the balance is repaid.

Tip: Use our HELOC calculator to see how much you can borrow based on your home’s value, mortgage balance and credit score range.

Current HELOC rates

As with other types of mortgages, HELOC rates can fluctuate daily according to market conditions. Here are the current average rates for a $100,000 HELOC, based on loan-to-value (LTV) ratios of 60%, 80% and 90%.

How to get the best HELOC rate

To get the best possible HELOC rate, you’ll generally need a: 

  • Significant amount of home equity
  • Good to excellent credit score
  • Low debt-to-income (DTI) ratio

Your lender may also consider other factors when determining the rate you qualify for, like your income, assets and employment.

HELOC pros and cons

Pros

  • Flexible borrowing option: You can borrow from and repay your HELOC credit line on an as-needed basis, which can be helpful for recurring expenses.
  • Long repayment terms: HELOC repayment periods can range up to 20 years, depending on the lender.
  • Lower interest rates: Because HELOCS are secured by collateral, they generally have lower rates compared to other types of unsecured financing, such as personal loans and credit cards.

Cons

  • Variable rates: Interest rates on HELOCs are variable. This means your rate could fluctuate based on market conditions.
  • Can come with closing costs: If your lender charges closing costs, you’ll typically pay 2% to 5% of the credit line amount.
  • Risk of losing your home: Your home acts as collateral for a HELOC. This means your lender could foreclose on your home if you fail to make your payments.

HELOC vs. home equity loan: What's the difference?

HELOCs and home equity loans both offer relatively low rates and let you borrow against your equity. However, they work slightly differently. 

With a HELOC, you’ll get a variable interest rate and the option to borrow as needed against a credit line during your draw period. The flexibility a HELOC provides can be useful if you are not sure exactly how much you’ll need to borrow or have recurring expenses. 

A home equity loan, on the other hand, provides a lump-sum amount to use how you’d like, similar to a personal loan. This type of loan will typically have a fixed interest rate, and you’ll begin making monthly principal and interest periods after your loan is disbursed. Because the rate is fixed, these payments will stay the same throughout the life of the loan.

HELOC alternatives

If a HELOC doesn’t sound like the right option for you, a home equity loan or personal loan could be a good alternative. Both home equity loans and personal loans come with fixed interest rates, meaning you’ll have predictable payments over the life of your loan. 

But there are some downsides too. For instance, you might end up with a higher interest rate than you would with a HELOC, and you’ll need to know exactly how much you wanted to borrow before applying for either type of loan. Do your due diligence to determine the best option for your situation.

Frequently asked questions (FAQs)

A good HELOC rate is generally considered to be one that’s below the national average. As of Jan. 25, 2024, the average rate for a $100,000 HELOC was 9.11%, 9.26% and 9.95% for LTV ratios of 60%, 80% and 90%, respectively, according to data from Curinos. 

Keep in mind that rates can vary between lenders, and the rate you’re offered will depend on several factors, including your credit line amount, the amount of equity you have in your home, your credit profile and more. In general, borrowers with good to excellent credit will be able to qualify for better rates compared to those with bad credit.

A HELOC can be a good idea if you need a more flexible financing option, such as to cover the cost of an ongoing home improvement project. However, you need significant equity in your home to qualify for a HELOC, so this type of credit line doesn’t make sense if you haven’t yet built up sufficient equity. Additionally, a variable-rate option might not be the best choice in a rising interest rate environment as your rate could increase considerably over time. 

Ultimately, make sure that if you’re going to use a HELOC, you can afford to repay what you borrow and that your budget can handle possible payment changes if your variable rate fluctuates. Remember that a HELOC is secured by your home, which means you risk losing it if you can’t keep up with your payments.

Yes, it’s possible to pay off a HELOC early. But depending on your lender, an early closure fee (also known as a prepayment penalty) could apply if you pay off and close your credit line within a certain period of time. These fees are often structured as a small percentage of the amount borrowed. 

If you’re considering early repayment, review your lending agreement or contact your lender to see if fees will apply.

HELOCs normally have variable interest rates. However, some lenders let you convert a portion or all of your balance into a fixed-rate loan once the draw period is over. If the stability of a fixed rate and monthly payment is important to you, make sure to look for a lender who offers the option to convert a HELOC from a variable rate to a fixed rate.

It might be possible to negotiate your rate on an existing HELOC, depending on the lender. If you’re interested in this option, contact your lender directly and ask. Certain lenders may be open to negotiating, while other lenders may not.

Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Jess Ullrich

BLUEPRINT

Jess is a personal finance writer who's been creating online content since 2009. Before transitioning to full-time freelance writing, Jess was on the editorial team at Investopedia and The Balance. Her work has been published on FinanceBuzz, HuffPost, Investopedia, The Balance and more.

Jamie Young

BLUEPRINT

Jamie Young is Lead Editor of loans and mortgages at ӣƵ Blueprint. She has been writing and editing professionally for 12 years. Previously, she worked for Forbes Advisor, Credible, LendingTree, Student Loan Hero, and GOBankingRates. Her work has also appeared on some of the best-known media outlets including Yahoo, Fox Business, Time, CBS News, AOL, MSN, and more. Jamie is passionate about finance, technology, and the Oxford comma. In her free time, she likes to game, play with her two crazy cats (Detective Snoop and his girl Friday), and try to keep up with her ever-growing plant collection.

Ashley Harrison is a ӣƵ Blueprint loans and mortgages deputy editor who has worked in the online finance space since 2017. She’s passionate about creating helpful content that makes complicated financial topics easy to understand. She has previously worked at Forbes Advisor, Credible, LendingTree and Student Loan Hero. Her work has appeared on Fox Business and Yahoo. Ashley is also an artist and massive horror fan who had her short story “The Box” produced by the award-winning NoSleep Podcast. In her free time, she likes to draw, play video games, and hang out with her black cats, Salem and Binx.