Latest news with #homeequityloan
CBS News
4 days ago
- Business
- CBS News
Should you lock a home equity loan interest rate this June?
There are multiple reasons why homeowners should lock in a home equity loan rate this June. Getty Images/iStockphoto When it comes to locking in an interest rate on a borrowing product, the timing can be difficult to get right. Wait too long and you risk having to pay more than you would have at an earlier point. Start too early, however, and you could see yourself getting locked in to a rate that declines right after you close on the loan. Monitoring the interest rate climate closely, then, for opportunities to act (and for times to step back) is critical. And it's even more important for homeowners considering a home equity loan. Since these funds come directly out of your home, which serves as collateral in the borrowing exchange, you'll want to ensure long-term affordability to offset any risk of foreclosure. That means knowing when to lock a home equity loan interest rate – and when not to. In the unique interest rate climate of June 2025, however, there's a compelling case to be made for locking in a home equity loan rate now. Below, we'll list three reasons why this makes sense for homeowners in need of extra financing. Start by seeing what home equity loan rate you'd be eligible for here. Should you lock a home equity loan interest rate this June? While each homeowner's financial situation is different, many homeowners considering a home equity loan would benefit from locking in a low rate now. Here's why: Home equity loan rates are stagnating Home equity loan interest rates steadily declined in 2024 and continued to slowly drop in the early months of 2025. But that progress has been slowed in recent weeks, with rates here dropping from 8.36% on May 14 to 8.23% on May 21 to 8.24% on May 28 and 8.25% on June 4, according to Bankrate data. While those aren't major differences week-over-week, they do indicate some uncertainty on behalf of lenders as they await new data on inflation, Fed rate cuts and economic policies. Considering that rates are still lower than the approximate 8.80% average from early 2024, those in need of a home equity loan now may want to lock in what's available at the moment – and look to refinance should the market significantly cool in the future. Get started with a low-rate home equity loan online today. Rates could stay higher for longer than anticipated Optimism earlier this year that the Federal Reserve would continue its interest-rate cut campaign in 2025 has waned significantly after the central bank kept rates paused at its January, March and May meetings. And the chances of a rate cut for when the bank meets again in June are also dim. Finally, if rates are eventually cut, either in July or September, it's likely to be just by 25 basis points to start, which will have a muted impact on home equity loan interest rates. Understanding this dynamic, then, and with relatively low home equity loan rates already available, it makes sense to lock in a rate now to limit any additional expenses that could arise from an extended rate pause. It's still cheaper than many alternatives The average interest rate on a personal loan? Close to 13% now. And the average credit card rate? Around 21%, just recently down from a record high. Even home equity lines of credit (HELOCs), which were clearly the cheapest borrowing option earlier this year, have become more expensive lately as rates there are up by more than 25 basis points from where they were earlier this spring. Matched up against these alternatives, then, and with the benefit of a fixed rate in a climate in which rates could easily rise again, proceeding with a home equity loan makes sense now. Not only is it cheaper than a credit card and HELOC – it will remain so as these other two alternatives have variable rates that could rise in response to market conditions while the home equity loan rate secured today will be the same one six months from now (or longer). The bottom line It may not always make sense to lock in a rate on a borrowing product, especially if the climate is cooling. But June 2025 isn't necessarily that economic atmosphere. With home equity loan rates low (but stagnant), the chances of higher rates for longer appearing more and more likely and the reality that rates here are still lower than some alternative products with variable rates, homeowners in need of financing may find that locking in a home equity loan rate this June makes the most sense for their needs and long-term goals.
CBS News
27-05-2025
- Business
- CBS News
With home equity loan rates low, borrowers should do these 3 things right now
We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. With home equity loan interest rates declining, borrowers should be strategic in their approach. Getty Images Home equity loans offer homeowners one of the more affordable ways to borrow a large sum of money right now. And, after last week, this became even clearer as home equity loan interest rates declined to a new 2025 low. At an average rate of just 8.23% currently, home equity loans are less expensive than personal loans and credit cards and are just a few basis points higher than home equity lines of credit (HELOCs). But the latter type has a variable rate that will change over time, while home equity loan rates are fixed, offering borrowers both affordability and predictability in today's unpredictable economic climate. But even though home equity loan rates are fixed, prospective borrowers shouldn't become complacent in their approach, either. With rates low currently, homeowners should instead take an aggressive but strategic approach. Below, we'll detail three things borrowers should do right now. Start by seeing how low a home equity loan rate you'd qualify for here. 3 things to do with home equity loan rates low right now Here are three timely moves homeowners should make now that home equity loan rates are low again: Shop for rates and lenders Did you know that you don't always have to use your current mortgage lender to borrow with a home equity loan? You may be able to secure lower rates and better terms with a competitor lender, but you won't know for sure until you start shopping around. So consider doing so right away. While that 8.23% rate is low, it's just an average, meaning that you could lock in an even lower rate if you have a high credit score and a clean overall credit profile. Consider getting rate quotes from three lenders to see what's available – and then go back to your current mortgage lender to see if they can beat the lowest of the three. It may take a bit of time and effort, but it will be worth it if it means paying less interest each month (and over the full life of the loan). Start shopping for low home equity loan rates here. Lock in a low rate when found Home equity loan rates are fixed, but they're not immune to the market conditions that cause rates on borrowing products to rise or fall. In other words, they could rise again, perhaps sooner than anticipated. So, after shopping around and exploring any potential rate offers your existing mortgage lender has, look to lock in the lowest rate available right now. Home equity loan rates change frequently, and today's competitive offer could be gone tomorrow. Locking it in when found will negate that concern, however. Additionally, borrowers could always refinance their loans in the future if rates continue to decline in a material fashion. In the interim, they'll lock in an affordable rate and get to use the funds to cover their immediate financial needs. Limit the amount being borrowed It can be (understandably) tempting to overborrow from your home equity when rates are low. But borrowing more than you can easily afford to pay back is always a mistake, especially when the funding source is your home. Failure to repay a home equity loan, after all, could lead to foreclosure on the property. So, avoid the temptation to borrow more to pay for additional, unnecessary expenses and instead stay focused on why you need to withdraw the equity in the first place. Then limit your loan to that precise amount only. The bottom line A new drop in home equity loan interest rates offers homeowners an opportunity to borrow some of the average $313,000 home equity amount owners have now at an affordable price. Still, borrowing should always be done strategically and with precision, particularly when using home equity. By making the above three timely moves right now, home equity loan users will both improve their chances of securing an affordable rate and maintain long-term affordability even if rates and the market fluctuate again. Learn more about borrowing with a home equity loan now here.
CNET
27-05-2025
- Business
- CNET
Best Home Equity Loan Lenders for 2025
A home equity loan lets homeowners borrow a lump sum against their property's value to pay for things like home improvements, debt consolidation or other large expenses. Unlike home equity lines of credit (HELOCs), home equity loans typically have fixed interest rates. That means your monthly payment will be the same over the term of your loan. Before committing to a home equity loan, create a repayment plan. When you take out a home equity loan or HELOC, your home serves as collateral, which means if you're unable to repay the debt, you risk losing your house. Home equity loans are available from a variety of lenders, including banks, credit unions and home equity loan companies. Just like when you took out your mortgage, it's important to compare loan offers from at least two or three different lenders before making a decision. Experts agree that comparison shopping is one of the best ways to get a lower interest rate. I spoke with experts and researched dozens of different lenders to create CNET's list of the best home equity loan lenders. Best home equity loan lenders for 2025 Lender APR Loan amount Loan terms Max LTV ratio U.S. Bank From 7.65% Not specified Up to 30 years Not specified TD Bank 7.99% (0.25% autopay discount included) From $10,000 5 to 30 years Not specified Connexus Credit Union From 7.31% From $5,000 5 to 15 years 90% KeyBank From 9.59% (0.25% autopay discount included) From $25,000 1 to 30 years 80% for standard home equity loans, 90% for high-value home equity loans Spring EQ Fill out application for personalized rates Up to $500,000 Not specified 90% Third Federal Savings & Loan From 6.99% $10,000 to $200,000 Up to 30 years 80% Frost Bank From 7.32% (0.25% autopay discount included) $2,000 to $500,000 15 to 20 years 90% Regions Bank From 6.75% to 14.125% $10,000 to $250,000 7, 10, 15, 20 or 30 years 89% Discover From 7% for first liens; From 8.55% for second liens $35,000 to $500,000 10, 15, 20 or 30 years 90% BMO Harris From 8.97% (0.5% autopay discount not included) From $25,000 5 to 20 years Not specified Note: The above APRs are current as of May 6, 2025. Your APR will depend on factors such as your credit score, income, loan term and whether you enroll in autopay or other lender-specific requirements. U.S. Bank Good for nationwide availability APR: From 7.65% U.S. Bank offers both home equity loans and HELOCs in 47 states (not including Texas, South Carolina and Delaware). You can borrow as little as $15,000 or up to $750,000 ($1 million for properties in California) depending on the available equity in your home. The bank offers a range of payback terms up to 30 years. We like U.S. Bank because of its extensive nationwide availability, many customer support options and price transparency — meaning you can get a personalized rate quote and fee information by filling out some basic information, no credit check required. Read CNET's review of U.S. Bank. TD Bank Good price transparency APR: From 7.99% (0.25% TD checking account discount included) TD Bank offers home equity loans and HELOCs in 15 states. Loan amounts for home equity loans start at $10,000. TD Bank offers payback terms ranging from five to 30 years. Although its nationwide availability is limited, TD Bank ranks high for its price transparency and wide variety of product offerings, including interest-only and rate-lock options on its HELOCs. The bank's good online user experience, price transparency and customer service options stand out to us. Read CNET's review of TD Bank. Connexus Credit Union Flexible credit union eligibility APR: From 7.31% Connexus Credit Union offers home equity loans and HELOCs in 46 states (excluding Alaska, Hawaii, Maryland and Texas). Loan amounts range from $5,000 to $200,000. Because Connexus is a credit union, its products and services are only available to its members. You can see the full membership eligibility requirements here. Connexus offers expansive nationwide availability and a few different product options, part of the reason this lender ranked highly for us. Its straightforward application process and relatively easy membership requirements is another bonus. Read CNET's review of Connexus Credit Union. KeyBank Good option for wide range of product offerings APR: From 9.59% (0.25% client discount included) KeyBank offers home equity loans to customers in 15 states and HELOCs to customers in 44 states. Aside from a standard HELOC, KeyBank also offers interest-only and rate-lock options. KeyBank's extensive product offerings stand out to us. The lender's streamlined application process for existing users is also useful. Both existing and new users will appreciate the online user experience and availability of customer service options from KeyBank. Read CNET's review of KeyBank. Spring EQ Good online application experience APR: N/A (Personalized rates available after preapproval) Spring EQ serves customers in 38 states, offering home equity loans and HELOCs with amounts ranging from $5,000 to $500,000. You can borrow up to 90% of your home's value, but you must have a minimum credit score of 640 and a debt-to-income, or DTI, ratio of 50% or less. It doesn't display rates online, but we rank Spring EQ highly because you don't need to undergo a hard credit check to see personalized rates. You can get prequalified for a loan with only basic information. Read CNET's review of Spring EQ. Third Federal Good for long repayment period APR: From 6.99% Third Federal Savings & Loan first opened in 1938. Today, the bank offers home equity loans in eight states and HELOCs in 26 states. Third Federal also offers a unique product not commonly found among other lenders: a 5/1 adjustable-rate home equity loan. Despite its limited nationwide availability for home equity loans, we like Third Federal for its rate match guarantee and its unique product offerings. Read CNET's review of Third Federal. Frost Bank Good option for Texas borrowers APR: From 7.32% (0.25% autopay discount included) Frost Bank, headquartered in San Antonio, Texas, offers products only to Texas residents. It offers home equity loans, HELOCs and interest-only HELOCs. Home equity loans are available with loan amounts of $2,000 and up, while HELOCs are available with line amounts of $8,000 and up. Although Frost Bank's nationwide availability is very limited, the bank has a helpful product selection tool, easy application process and good price transparency, making it a strong option for Texas borrowers. Read CNET's review of Frost Bank. Regions Bank Good for autopay discounts APR: From 6.75% (Regions client discount included) Regions Bank serves people across the South, Midwest and Texas, offering home equity loans and HELOCs in 15 states. Home equity loans have amounts of $10,000 to $250,000 and repayment periods of either seven, 10, 15 or 20 years. For home equity loans with Regions, there are no closing costs. Regions ranks highly because of its low fees, variety of application options and wide range of customer service options. However, Regions' nationwide availability is fairly limited. Read CNET's review of Regions Bank. Discover Good for no fees or closing costs APR: From 7% first liens, from 8% second liens Discover is known primarily for its credit cards, but it also offers home equity loans — available in 48 states. The lender doesn't offer HELOCs at all. For Discover home equity loans, amounts range from $35,000 to $300,000. We like that Discover has no fees or closing costs attached to its home equity loans. Discover's nationwide availability for its home equity loans and good price transparency also stood out to us. Read CNET's review of Discover. BMO Harris Good introductory APR APR: From 8.97% (0.5% autopay discount not included) BMO Harris products and services are available in 48 states (all but New York and Texas). BMO Harris offers home equity loans and three variations of a HELOC. Loan amounts for home equity loans start at $5,000 and repayment periods range from five to 20 years. You can borrow up to 89.99% of your home with most BMO Harris home equity loans. A 100% maximum CLTV — the ratio of all secured loans on a home to the value of home — option is available for low-to-moderate income borrowers or Low to Moderate Income Census Tract customers who need to make home improvements. We like that BMO Harris offers both home equity loans and three types of HELOCs almost nationwide. We found its online application less straightforward than its competitors. Read CNET's review of BMO Harris. How to find the best home equity loan lenders You don't need to get your home equity loan from the same mortgage lender you already have, although it may make sense to do so. Shopping for a different lender and comparing offers might help you secure a lower interest rate. Be sure to ask questions upfront to understand what rates and fees are associated with your home equity loan. Remember, the rate a lender advertises isn't always the rate you qualify for. Your exact interest rate will depend on multiple factors, including your DTI ratio, LTV ratio and loan amount. The lowest rates are generally reserved for borrowers with a good credit score and clean credit history. Also, make sure to look at the lender's APR, not just the interest rate. The APR includes fees, so it will be a more accurate figure of what you'll pay. A good lender will make you feel comfortable with the borrowing process and make sure you understand what upfront or ongoing fees apply to the loan. When comparing lenders, also consider how convenient the application process is, if there are any local branches available to you, the lender's customer support options and any available rate discounts. What is a home equity loan? A home equity loan offers you a one-time cash installment, which you'll pay back over a set period. A home equity loan is similar to taking out a personal loan, except this loan is secured by the value of your home ( specifically, the difference between what your home is worth and what you owe on your mortgage). If you default on payments for any reason, the lender could take your home as payment. The amount you can borrow with a home equity loan is determined by the amount of equity you have. Most lenders cap the amount you borrow to more than 85% of your home's equity, but that number will vary from lender to lender. Money from a home equity loan can be used for anything, ranging from home renovation projects to consolidating variable-rate debt. A home equity loan is best for borrowers with fixed costs and a defined goal for your money. Unlike a HELOC, a home equity loan typically has a fixed interest rate, so your monthly payment will be the same over the term of your loan. How to get a home equity loan Applying for a home equity loan is similar to applying for a mortgage. You'll first want to interview multiple lenders to determine which lender can offer the lowest rates and fees. The more companies you speak with, the better your chances of finding favorable terms. You'll also need equity in your home. Almost all lenders require you to have at least 15% to 20% equity in your home before being considered for a home equity loan. Lenders will then take into account your credit score, income and current debt-to-income ratio to determine your interest rate. Be prepared with financial documents, such as pay stubs, W-2s, proof of ownership and the appraised value of your home. Once you submit your application, the final step is closing on your loan. Requirements for a home equity loan Although it varies by lender, to qualify for a home equity loan you're typically required to meet the following criteria: Have at least 15% to 20% equity in your home: To know your home equity, i.e., the amount of home you own, subtract what you owe on your mortgage and other loans from the current appraised value of your house. Adequate, verifiable income and stable employment: Proof of income is a standard requirement to qualify for a home equity loan. Check your lender's website to see what forms and paperwork you need to submit. A minimum credit score of 620: Lenders use your credit score to determine the likelihood that you'll repay the loan on time. Having a stronger credit score will help you qualify for a lower interest rate and more amenable loan terms. A debt-to-income ratio of 43% or less: Divide your total monthly debts by your gross monthly income to get your DTI. Like your credit score, your DTI helps lenders determine your capacity to make consistent payments toward your loan. Some lenders prefer a DTI of 36% or less. Alternatives to home equity loans If a home equity loan isn't the right move for you, there are other financing options. HELOC A HELOC offers you a revolving line of credit against the equity you've built in your home. You can take out money as needed, up to your total line of credit, during your draw period (usually 10 years). Similar to a credit card, there's a limit on how much you can borrow at once. After your draw period ends, you'll enter your repayment period and make payments toward both the interest and principal (how much money you've borrowed) on your loan. The interest rates for a HELOC are usually variable, so rates will generally rise and fall along the prime rate. A HELOC is a good choice if you're unsure of how much money you need or if you want access to an ongoing source of cash over a period of months or years. Personal loan When you take out a personal loan, you receive a one-time cash infusion that you pay back over the life of the loan. Personal loans tend to have higher interest rates than home equity loans, but they're less risky because you don't put your home up as collateral. Cash-out refinance Unlike a home equity loan or HELOC, a cash-out refinance replaces your existing mortgage with a new home loan. Ideally, the new mortgage has a lower interest rate and more favorable terms. A cash-out refinance provides you with an upfront sum of cash that's then added back onto the balance of your new mortgage. The bottom line A home equity loan allows you to leverage your home's equity without disturbing your primary mortgage rate. Make sure to shop around and compare lenders to find the best rate and most amenable loan terms for your needs. In addition to interest rates, consider a lender's APR, rate discounts, application process and any costs or fees associated with the loan. FAQs Is it a good idea to borrow from your home's equity? Borrowing from your home's equity, whether through a home equity loan, HELOC or cash-out refinance, can be a good way to access large amounts of cash at relatively low interest rates compared with credit cards and personal loans. It's not without risks. Because your house acts as collateral for the loan, you could lose your home if you fall behind on payments. That's why it's important to only borrow what you can afford to pay off. Avoid borrowing against the equity of your home for nonessential expenses such as a vacation, wedding or luxury purchase. How much can you borrow with a home equity loan? Exact requirements vary by lender, but most home equity loan lenders limit your loan-to-value ratio to 85% or under. This means that the total value of the home equity loan you're seeking, plus the outstanding loan balance on your primary mortgage, can't exceed 85% of your home's appraised value. For example, if you have a house worth $300,000 and a $100,000 mortgage balance, the maximum amount you can borrow with a home equity loan would be $155,000 (assuming a maximum LTV of 85%). How much can you borrow with a home equity loan? When deciding whether to grant you a home equity loan, lenders look at multiple factors: your credit score and credit report, your debt-to-income ratio, your monthly income and how much equity you have in your home, among other things. Each lender also has its own unique underwriting requirements. In general, you'll want a credit score of at least 620 to have the best chance of getting a home equity loan. Keep in mind that your credit score can also affect the interest rate you get. The lowest advertised rates are usually reserved for borrowers with higher credit scores — usually 700 and above. Methodology We evaluated a range of lenders based on factors such as interest rates, APRs and fees, how long the draw and repayment periods are, and what types and variety of loans are offered. We also took into account factors that impact the user experience such as how easy it is to apply for a loan online and whether physical lender locations exist. Learn more about our methodology here.
CBS News
22-05-2025
- Business
- CBS News
Home equity loan rates hit 2025 low: Why you should take advantage now
We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. Home equity loan interest rates declined to their lowest point so far in 2025 this week. Getty Images Home equity loan interest rates, already on a slow but consistent decline for much of the last 18 months, fell to a new 2025 low this week. Now at an average of just 8.23%, home equity loan rates are falling again, according to Bankrate data. The recent decline marked a 13 basis point drop from May 14, and it continued the trend of home equity loan rates declining after they started 2024 close to 9%. This new decline, however, is a particularly important one as it comes amid a pause in the federal funds rate, which hasn't been reduced since December 2024. And it emphasizes the cost-effectiveness of this borrowing tool right now, as rates here are materially lower than those available with personal loans (over 12%) and credit cards (over 22%). As borrowers have experienced in recent years, however, the interest rate climate can be volatile. So with home equity loan rates hitting a new 2025 low, it could make sense to take advantage of this timely opportunity while readily available. Below, we'll detail three reasons why it makes sense to take action now. Start by seeing how low a home equity loan rate you'd be eligible for here. Why you should take advantage of a low home equity loan rate now Here are three timely reasons why you should consider locking a home equity loan rate now: Home equity loan rates are fixed As noted above, it's been a bumpy ride down to this low of a home equity loan rate, and there's no telling when rates will go lower, or even if they will. Fortunately, a home equity loan comes with a fixed rate that will remain the same for borrowers even if the interest rate climate reverses course in the weeks or months ahead. Considering that rates here are lower than most alternatives, then, it makes sense to secure this affordability while you can. And, if rates decline in a significant way in the future, you could always refinance your home equity loan at that point. In the interim, however, you'll be protected against any future rate hikes ahead. Get started with a home equity loan online today. HELOC rates have been increasing For much of 2025, a home equity line of credit (HELOC) was the more affordable option when measured against a home equity loan. While home equity loan rates remained relatively unchanged, HELOC rates continued to fall and, at one point, were more than two full percentage points below their September 2024 average. But that window of opportunity has since passed. HELOC rates have been steadily climbing in recent weeks and are now virtually the same as a home equity loan at an average of 8.20%. Unlike home equity loans, however, HELOCs have variable rates that adjust monthly, meaning that they could rise even higher should trends continue as they have so far in May. In this climate, then, a home equity loan may be the better option. Your financing needs may not be able to wait Waiting for an ideal interest rate scenario isn't realistic for many homeowners right now, and it's arguably not necessary when home equity loan rates are as low as they are currently. Your financing needs, meantime, may not be able to wait for the interest rate climate to cool any further, particularly if you're planning to use your home equity to consolidate high-rate debt, like that accumulated with credit cards, for example. Considering that credit card rates are almost three times higher than home equity loan rates, it makes sense to use the latter to pay off the former now – and not delay and damage your financial standing any further. The bottom line With home equity loan interest rates at a new low for 2025, homeowners in need of additional financing may want to take advantage of this opportunity now. Considering that this low rate will be fixed, that alternatives like HELOCs are actually becoming more expensive and the urgent financing needs that a home equity loan can help cover, many would benefit by shopping around for lenders and rates now. Just be sure to calculate your repayment costs with precision as your home functions as collateral in this scenario and it could be foreclosed on if you're ultimately unable to repay all that was withdrawn. Learn more about your current home equity loan options here.
CBS News
09-05-2025
- Business
- CBS News
How much does a $15,000 home equity loan cost per month in 2025?
We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. Homeowners should calculate their potential monthly home equity loan costs before securing the financing. Getty Images A home equity loan is traditionally one of the less expensive ways to borrow money (and it's one of the only ways to borrow a large, six-figure sum). With the home functioning as collateral, lenders typically feel less risk in the borrowing exchange, and that confidence is reflected in lower interest rates for the homeowner. Those rates have been coming down consistently for home equity loans after declining for much of 2024 and into 2025. At an average of just 8.36% now, home equity loans are much more affordable than personal loans (with an average rate of over 12% now) and credit cards (just under a record high of 23%). Only a home equity line of credit (HELOC), with a rate of just under 8%, is cheaper (and that rate is variable and subject to rise or fall over time, while home equity loan rates are fixed). Understanding this evolution in rates, then, and the reality of an average home equity amount over $300,000, some homeowners may be contemplating using a home equity loan to access a relatively smaller sum of $15,000. This amount of money can help finance major home repairs or projects, pay down high-rate debt, or more, and it can be done so while leaving a substantial equity buffer in the home for potential use in the future. Before getting started, however, homeowners should precisely calculate their potential repayment costs. Thanks to the fixed home equity loan rate, this is simple to do. Below, we'll do the math. See how low a home equity loan rate you'd be eligible for here. How much does a $15,000 home equity loan cost per month in 2025? According to Bankrate, average home equity loan rates vary depending on the length of the repayment. Here, then, is what a $15,000 home equity loan will cost per month if secured now, at the average rates available in May 2025: 5-year home equity loan at 8.36%: $306.74 per month $306.74 per month 10-year home equity loan at 8.51%: $186.06 per month $186.06 per month 15-year home equity loan at 8.41%: $146.92 per month So, on the surface, a $15,000 home equity loan calculated at today's average rates will cost borrowers between $147 and $307 monthly, approximately. But those rates could look different for you, depending on your credit score and profile. If your credit is in good shape, you may be offered lower rates and better terms and vice versa. It's important, then, to first check your credit score. If it's in good shape, then you can feel comfortable proceeding with a home equity loan, but if it needs work, it may be better to focus on that as the first step. Get started with a home equity loan online today. What are my home equity loan alternatives? While a home equity loan remains one of your most affordable ways to borrow home equity in today's economy, it's not the only way to do so. Here are three home equity loan alternatives that may be worth researching now: HELOCs: A HELOC functions as a revolving line of credit in which interest-only payments will be required during the draw period. But the rate here is variable and can rise and fall based on market conditions, so be sure to crunch your repayments on the rates that are available right now as well as what they could be in the future, to better determine long-term affordability. Cash-out refinances: For those with a substantial amount of equity in their home, this option could be worth researching now. It involves taking out a new mortgage loan larger than your current balance. You then pay off your balance and keep the difference between the two as cash. It will require exchanging your current mortgage rate for what's available today, however, so it may not be beneficial for those with rates substantially lower than today's averages. Reverse mortgages: Generally only applicable to homeowners 62 and older, this could be worth exploring for older homeowners who can't afford to make monthly repayments. In this situation, homeowners will receive monthly payments from their accumulated equity. They'll need to pay it back, however, if the homeowner dies or if the home is sold. The bottom line A $15,000 home equity loan comes with monthly affordable payments for homeowners in today's rate climate. And because it won't subtract too much equity from the average six-figure sum most homeowners have now, it could be the smartest way to borrow $15,000 worth of equity now. But with alternatives like HELOCs, cash-out refinances and reverse mortgages potentially more applicable to your unique circumstances, it's worth taking the time to research each to better understand which makes the most sense for you now and in the future.
