Latest news with #homeEquity
Yahoo
09-07-2025
- Business
- Yahoo
HELOC rates today, July 9, 2025: The home equity line of credit rate remains favorable
HELOC interest rates are locked into a sweet spot. Although the Federal Reserve may not make interest rate cuts for the remainder of the summer, the second mortgage market shrugs — happy to leave rates where they are for now. Perhaps this fall, the Fed will begin cutting short-term interest rates again, and the prime rate will likely follow. That means any variable rate you get on a HELOC may go down. In the meantime, you might score a nice, low, introductory rate. Let's check today's home equity line of credit rate. This embedded content is not available in your region. According to Bank of America, the largest HELOC lender in the country, today's average rate on a 10-year draw HELOC is 8.90%. That is a variable rate that kicks in after a six-month introductory rate of 6.49%. Homeowners have a sizable amount of value tied up in their houses — more than $34 trillion at the end of 2024, according to the Federal Reserve. That's the third-largest amount of home equity on record. With mortgage rates lingering in the high 6% range, homeowners are not likely to let go of their primary mortgage anytime soon, so selling the house may not be an option. Why let go of your 5%, 4% — or even 3% mortgage? Accessing some of the value locked into your house with a use-it-as-you-need-it HELOC can be an excellent alternative. HELOC interest rates are different from primary mortgage rates. Second mortgage rates are based on an index rate plus a margin. That index is often the prime rate, which today is 7.50%. If a lender added 1% as a margin, the HELOC would have a rate of 8.50%. Lenders have flexibility with pricing on a second mortgage product, such as a HELOC or home equity loan, so it pays to shop around. Your rate will depend on your credit score, the amount of debt you carry, and the amount of your credit line compared to the value of your home. And average national HELOC rates can include "introductory" rates that may only last for six months or one year. After that, your interest rate will become adjustable, likely beginning at a substantially higher rate. You don't have to give up your low-rate mortgage to access the equity in your home. Keep your primary mortgage and consider a second mortgage, such as a home equity line of credit. The best HELOC lenders offer low fees, a fixed-rate option, and generous credit lines. A HELOC allows you to easily use your home equity in any way and in any amount you choose, up to your credit line limit. Pull some out; pay it back. Repeat. Meanwhile, you're paying down your low-interest-rate primary mortgage like the wealth-building machine you are. This embedded content is not available in your region. Today, FourLeaf Credit Union is offering a HELOC rate of 6.49% for 12 months on lines up to $500,000. That's an introductory rate that will convert to a variable rate later. When shopping lenders, be aware of both rates. And as always, compare fees, repayment terms, and the minimum draw amount. The draw is the amount of money a lender requires you to initially take from your equity. The power of a HELOC is tapping only what you need and leaving some of your line of credit available for future needs. You don't pay interest on what you don't borrow. Rates vary so much from one lender to the next that it's hard to pin down a magic number. You may see rates from nearly 7% to as much as 18%. It really depends on your creditworthiness and how diligent a shopper you are. For homeowners with low primary mortgage rates and a chunk of equity in their house, it's probably one of the best times to get a HELOC. You don't give up that great mortgage rate, and you can use the cash drawn from your equity for things like home improvements, repairs, and upgrades. Of course, you can use a HELOC for fun things too, like a vacation — if you have the discipline to pay it off promptly. A vacation is likely not worth taking on long-term debt. If you take out the full $50,000 from a line of credit on a $400,000 home, your payment may be around $395 per month with a variable interest rate beginning at 8.75%. That's for a HELOC with a 10-year draw period and a 20-year repayment period. That sounds good, but remember, it winds up being a 30-year loan. HELOCs are best if you borrow and pay back the balance in a much shorter period of time.
Yahoo
02-07-2025
- Business
- Yahoo
HELOC rates today, July 2, 2025: The home equity line of credit rate sneaks up slightly
HELOC interest rates moved a little higher today. Federal Reserve Chairman Jerome Powell spoke at a monetary policy event in Portugal yesterday, but remains cautious. He did not, however, rule out a rate cut in July. When the Fed finally starts cutting short-term interest rates again, the prime rate will likely follow. That can ease consumer pricing on financial products such as credit cards, personal loans, and, yes, HELOC rates. Let's check today's home equity line of credit rates. According to Zillow, rates on 10-year HELOCs moved higher today seven basis points to 6.62%. The same rate is also available on 15- and 20-year HELOCS. VA-backed HELOCs clicked up one basis point to 6.14%. Homeowners have a sizable amount of value tied up in their houses — more than $34 trillion at the end of 2024, according to the Federal Reserve. That's the third-largest amount of home equity on record. With mortgage rates lingering in the high 6% range, homeowners are not likely to let go of their primary mortgage anytime soon, so selling the house may not be an option. Why let go of your 5%, 4% — or even 3% mortgage? Accessing some of the value locked into your house with a use-it-as-you-need-it HELOC can be an excellent alternative. HELOC interest rates are different from primary mortgage rates. Second mortgage rates are based on an index rate plus a margin. That index is often the prime rate, which today is 7.50%. If a lender added 1% as a margin, the HELOC would have a rate of 8.50%. However, you will find reported HELOC rates are much lower than that. That's because lenders have flexibility with pricing on a second mortgage product, such as a HELOC or home equity loan. Your rate will depend on your credit score, the amount of debt you carry, and the amount of your credit line compared to the value of your home. And average national HELOC rates can include "introductory" rates that may only last for six months or one year. After that, your interest rate will become adjustable, likely beginning at a substantially higher rate. You don't have to give up your low-rate mortgage to access the equity in your home. Keep your primary mortgage and consider a second mortgage, such as a home equity line of credit. The best HELOC lenders offer low fees, a fixed-rate option, and generous credit lines. A HELOC allows you to easily use your home equity in any way and in any amount you choose, up to your credit line limit. Pull some out; pay it back. Repeat. Meanwhile, you're paying down your low-interest-rate primary mortgage like the wealth-building machine you are. Today, FourLeaf Credit Union is offering a HELOC rate of 6.49% for 12 months on lines up to $500,000. That's an introductory rate that will convert to a variable rate later. When shopping lenders, be aware of both rates. And as always, compare fees, repayment terms, and the minimum draw amount. The draw is the amount of money a lender requires you to initially take from your equity. The power of a HELOC is tapping only what you need and leaving some of your line of credit available for future needs. You don't pay interest on what you don't borrow. Rates vary so much from one lender to the next that it's hard to pin down a magic number. You may see rates from nearly 7% to as much as 18%. It really depends on your creditworthiness and how diligent a shopper you are. For homeowners with low primary mortgage rates and a chunk of equity in their house, it's probably one of the best times to get a HELOC. You don't give up that great mortgage rate, and you can use the cash drawn from your equity for things like home improvements, repairs, and upgrades. Of course, you can use a HELOC for fun things too, like a vacation — if you have the discipline to pay it off promptly. A vacation is likely not worth taking on long-term debt. If you take out the full $50,000 from a line of credit on a $400,000 home, your payment may be around $395 per month with a variable interest rate beginning at 8.75%. That's for a HELOC with a 10-year draw period and a 20-year repayment period. That sounds good, but remember, it winds up being a 30-year loan. HELOCs are best if you borrow and pay back the balance in a much shorter period of time.
Yahoo
01-07-2025
- Business
- Yahoo
I'm 69 with a $250K reverse mortgage hanging over my head — should I use up most of my nest egg to pay it off?
Imagine this scenario: Samantha is retired at 69, but a few years back she took out a reverse mortgage. Now, she'd like to be done with it, especially since the loan comes with a hefty interest rate of 6.75%. She currently has about $375,000 in home equity while her reverse mortgage loan is close to $250,000. She also has about $300,000 in savings, but she's wondering if she should use a chunk of those savings to pay off her reverse mortgage and live on her Social Security (about $2,500 a month) instead. I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan 'works every single time' to kill debt, get rich in America — and that 'anyone' can do it Or, does it make more sense to stick with the status quo? A reverse mortgage allows homeowners who are at least 62 to borrow money based on the equity in their home. (Your equity is based on how much you'd get if you sold your home, minus how much you have left on your mortgage.) Unlike a traditional mortgage, you don't make monthly loan payments. Instead, the lender pays you, using your house as collateral. 'Reverse mortgage payments are considered loan proceeds and not income. The lender pays you, the borrower, loan proceeds (in a lump sum, a monthly advance, a line of credit, or a combination of all three) while you continue to live in your home,' according to the IRS. Because it isn't considered income, the money is tax-free and won't generally impact your Social Security or Medicare benefits. But, you still have to pay property taxes and insurance. Interest accrues on the loan balance, meaning the amount you owe goes up over time. If you have a high interest rate, that can add up — and fast. It increases your debt while decreasing your equity, and the interest added to your balance each month can 'use up much — or even all — of your equity,' explains the Federal Trade Commission about the risks of a reverse mortgage. The total (including interest) must be repaid either when you move out and sell your home or after you pass away, in which case it must be repaid by your estate. If you sell your home, you can use part of the proceeds of the sale to pay off the loan. This could make sense if you want to downsize or move in with family, or if you need to move into an assisted living facility. However, if you continue living in your home until you pass away, your heirs will inherit the house — and the reverse mortgage. The loan would have to be paid in full, if they decide to keep the home. If they instead decide to sell, 'they must repay the full loan balance, or at least 95 percent of its appraised value if the loan balance owed is more than the home value,' according to the Consumer Financial Protection Agency. Typically, they would have 30 days to repay the loan after receiving a notice from the lender (or turn over the home to the lender), although it's possible to get an extension if they're actively trying to purchase or sell the home. Read more: You don't have to be a millionaire to gain access to . In fact, you can get started with as little as $10 — here's how Maybe Samantha wants the peace of mind of owning her home, or maybe she wants to leave the house to her children without burdening them with debt. Whatever the reason, she does have a few options. One of those options is to do nothing. She could choose to remain in her home, with enough money coming in from Social Security and her retirement savings to enjoy a comfortable retirement. When she passes away, her children could sell it and use the proceeds to pay off the reverse mortgage. It's a trade-off: Samantha lives more comfortably and leaves less to her children, or she lives a more spartan lifestyle to leave more to her children. If Samantha does decide to pay the loan off early, she could consider refinancing (turning a reverse mortgage into a regular mortgage), though that may not make sense in a high interest rate environment. She could also consider paying it all off in one lump sum, making a partial payment (such as paying off $50,000 to $100,000 now while preserving some of her savings) or making loan payments to reduce her interest over time. Or, she could keep the reverse mortgage and invest that money conservatively as part of her long-term retirement plan. Even if Samantha can live off her Social Security and savings, she'll still be responsible for paying property tax, insurance and maintenance on her home. Plus, she may not want to drain her savings in case she needs that money for an emergency or future medical care. If you're considering paying off a reverse mortgage early, it's a good idea to sit down with a qualified financial advisor to model various scenarios based on your Social Security income, retirement savings, withdrawal rate and taxes — and how different scenarios would play out if you paid it off (either in a lump sum or with smaller payments over time). This could help you make an educated decision based on calculations instead of emotion. This tiny hot Costco item has skyrocketed 74% in price in under 2 years — but now the retail giant is restricting purchases. Here's how to buy the coveted asset in bulk Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CBS News
26-06-2025
- Business
- CBS News
3 times HELOC rates could fall this summer
HELOC interest rates could be positioned to decline again later this summer. Getty Images For a few months earlier this year, it felt like interest rates on home equity lines of credit (HELOCs) were on a permanent decline. After cooling for much of 2024, rates on the popular home equity borrowing product dropped to an 18-month low in January, a two-year low in February and another one in March. By early April, the average HELOC interest rate was comfortably below 8%, marking a remarkable two-plus percentage point drop in less than six months. And it seemed possible that rates could fall closer to 7% by the summer. But that possibility hasn't come to fruition, and HELOC rates have made a gradual but steady rise since then to 8.27%, where they currently reside. But since rates here are variable and subject to change monthly, both existing borrowers and prospective ones shouldn't worry too much either. Rates here are still much lower than what can be secured with alternatives like personal loans and credit cards. And they'll decline with no effort (or refinancing costs) on behalf of the borrower. That said, when exactly could HELOC rates fall again? Below, we'll examine three calendar dates when HELOC rates could fall again this summer. Start by seeing what HELOC rate you'd currently qualify for here. 3 times HELOC rates could fall this summer While predicting the future of interest rates is inherently impossible to do with precision, if recent history is any indication (and with an understanding of what drives HELOC rates), they could become cooler on one or more of the following dates this summer: July 15, 2025: The June inflation report release Inflation ticked up by a single basis point in May after falling for a few months prior. Now at just 2.4%, the rate is many percentage points lower than its June 2022 high of over 9%. And with the Federal Reserve's target goal of 2%, inflation is closing in on where the bank wants it to be. Should the next inflation reading released by the Bureau of Labor Statistics on this date show another decline or, potentially, the rate even nearing that 2% goal, it could give the Fed the motivation it needs to reduce rates while offering home equity lenders the data support they need to start preemptively lowering rates in anticipation of a formal cut. Compare your current HELOC rate offers here to determine affordability. July 29, 2025: The July Federal Reserve meeting Earlier this year, many economists and experts were all but guaranteeing that the central bank would reduce rates at their mid-summer meeting. And they still might, should economic conditions change in a way that encourages them to take action. If they do, HELOC rates may decline on or around this date. While not nearly as likely as once expected, the Fed can cut rates here. And, even if they don't, comments made post-meeting about any future rate reductions could be strong enough to cool the rate climate anyway, including those on HELOCs. September 17, 2025: The September Federal Reserve meeting Sure, this is the very end of the summer but this is arguably the most realistic date when borrowers could expect HELOC rates to change. On this date, the Federal Reserve will conclude its two-day September meeting and, with it, likely issue its first rate reduction since December 2024. Right now, the CME Group's FedWatch tool has a cut here listed at more than a 90% likelihood. Yes, economic factors could skew this outlook and, yes, HELOC rates may change before or after the meeting, but if you're trying to time your HELOC application or looking for relief in your current HELOC repayment structure, this is the top time to pay attention to this summer. The bottom line Market conditions are constantly evolving but there's reason for homeowners borrowing with a HELOC to be cautiously optimistic this summer. There are multiple dates in which rates could fall, either individually or collectively. That said, home equity loan rates right now are approximately the same as HELOCs and rates there are fixed. So, if you know you want to borrow home equity but don't want to have to continually monitor the market for changes that could impact your monthly repayments, a home equity loan may be the preferable option.
Yahoo
25-06-2025
- Business
- Yahoo
HELOC rates today, June 25, 2025: Home equity line of credit rates decline slightly
HELOC interest rates slipped lower today. Federal Reserve Chairman Jerome Powell appeared before the U.S. House Financial Services Committee on Tuesday and will sit before a Senate committee today. While hope for a summer interest rate cut was growing, Powell's message remains cautionary. When the Fed finally lowers short-term interest rates —probably sometime this fall — the prime rate will notch lower, too. This will provide consumers with a slight discount on borrowing costs, including HELOC rates. Let's check today's home equity line of credit rates. This embedded content is not available in your region. According to Zillow, rates on 10-year HELOCs dropped five basis points today to 6.62%. The same rate is also available on 15- and 20-year HELOCS. VA-backed HELOCs slipped three basis points lower to 6.21%. Homeowners have a sizable amount of value tied up in their houses — more than $34 trillion at the end of 2024, according to the Federal Reserve. That's the third-largest amount of home equity on record. With mortgage rates lingering in the high 6% range, homeowners are not likely to let go of their primary mortgage anytime soon, so selling the house may not be an option. Why let go of your 5%, 4% — or even 3% mortgage? Accessing some of the value locked into your house with a use-it-as-you-need-it HELOC can be an excellent alternative. HELOC interest rates are different from primary mortgage rates. Second mortgage rates are based on an index rate plus a margin. That index is often the prime rate, which today is 7.50%. If a lender added 1% as a margin, the HELOC would have a rate of 8.50%. However, you will find reported HELOC rates are much lower than that. That's because lenders have flexibility with pricing on a second mortgage product, such as a HELOC or home equity loan. Your rate will depend on your credit score, the amount of debt you carry, and the amount of your credit line compared to the value of your home. And average national HELOC rates can include "introductory" rates that may only last for six months or one year. After that, your interest rate will become adjustable, likely beginning at a substantially higher rate. You don't have to give up your low-rate mortgage to access the equity in your home. Keep your primary mortgage and consider a second mortgage, such as a home equity line of credit. The best HELOC lenders offer low fees, a fixed-rate option, and generous credit lines. A HELOC allows you to easily use your home equity in any way and in any amount you choose, up to your credit line limit. Pull some out; pay it back. Repeat. Meanwhile, you're paying down your low-interest-rate primary mortgage like the wealth-building machine you are. This embedded content is not available in your region. Today, FourLeaf Credit Union is offering a HELOC rate of 6.49% for 12 months on lines up to $500,000. That's an introductory rate that will convert to a variable rate later. When shopping lenders, be aware of both rates. And as always, compare fees, repayment terms, and the minimum draw amount. The draw is the amount of money a lender requires you to initially take from your equity. The power of a HELOC is tapping only what you need and leaving some of your line of credit available for future needs. You don't pay interest on what you don't borrow. Rates vary so much from one lender to the next that it's hard to pin down a magic number. You may see rates from nearly 7% to as much as 18%. It really depends on your creditworthiness and how diligent a shopper you are. For homeowners with low primary mortgage rates and a chunk of equity in their house, it's probably one of the best times to get a HELOC. You don't give up that great mortgage rate, and you can use the cash drawn from your equity for things like home improvements, repairs, and upgrades. Of course, you can use a HELOC for fun things too, like a vacation — if you have the discipline to pay it off promptly. A vacation is likely not worth taking on long-term debt. If you take out the full $50,000 from a line of credit on a $400,000 home, your payment may be around $395 per month with a variable interest rate beginning at 8.75%. That's for a HELOC with a 10-year draw period and a 20-year repayment period. That sounds good, but remember, it winds up being a 30-year loan. HELOCs are best if you borrow and pay back the balance in a much shorter period of time.
