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Best home equity loan lenders and rates

Tap into the equity in your home by borrowing from these top banks, credit unions and online-only lenders.

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By

Katia Iervasi

Updated

Fact checked

With so many lenders competing for your business, borrowers are in an ideal position to find a competitive fixed rate on a home equity loan — and in many cases, you may not have to pay closing costs or origination fees.

Our team of experts reviewed 20+ lenders before creating this list of the best home equity loan providers. We made our selection based on interest rates, rate discounts and no closing costs or fees.

We also scanned reviews from consumer forums like Trustpilot and the Better Business Bureau (BBB) website to see what customers think of these lenders. To learn more, read the full methodology of how we rate home loan providers.

Best home equity loans

Best for comparing multiple lenders: LendingTree

LendingTree

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LendingTree is an online loan marketplace that partners with a range of home loan lenders across the US. Fill out the application and if you qualify, LendingTree matches you with lenders willing to work with your credit score and loan preferences.

LendingTree claims you may get a lower rate since lenders are competing for your business, but you may receive a large number of emails and phone calls.

Best for low rates: Regions Bank

Regions Bank

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This Midwest- and Southeast-based lender doesn't charge closing costs on its home equity loans and offers fixed rates that start at APR with autopay as of July 2022 — lower than what many other lenders are currently charging.

With Regions, you can borrow between $15,000 and $250,000 for 7, 10, 15 and 20 years with no prepayment penalty. But customer reviews for the bank aren't the greatest.

Best for flexible lending requirements: U.S. Bank

U.S. Bank

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U.S. Bank considers the borrower's full credit history rather than their FICO score only when underwriting loans. Its rates start higher than lenders like Regions Bank, and it only offers two terms on its home equity loans: 10 and 15 years. But its greater flexibility could be helpful if you're rebuilding your credit, and it offers higher borrowing amounts than other lenders.

Best for military members: Navy Federal Credit Union

Navy Federal Credit Union

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If you're a homeowner who's affiliated with the armed forces, Navy Federal has some benefits you might not find elsewhere. In addition to competitive rates, Navy Federal Credit Union offers a maximum combined loan-to-value ratio (CLTV) of 100%, which is uncommon with home equity loans. With Navy Federal you can borrow up to $500,000 with pay your loan back over 5, 10, 15, or 20 years.

Best for faster funding: Spring EQ

Spring EQ

If you're looking for a lender that has technology to make it easier and faster to get a home equity loan, Spring EQ gets high marks from customers for its reduced paperwork application process.

The lender offers home equity loans up to $500,000 and lends to eligible borrowers at a combined LTV of 97.5% — higher than many other lenders — with repayment terms ranging from five to 30 years.

Compare current home equity loan rates

Use our tool to get personalized estimated rates from top lenders based on your location and financial details. Select Home Equity Loan, enter your ZIP code, credit score and information about your current home to see your personalized rates.

How to get the best home equity rate

The interest rate you get is largely determined by your FICO score, the loan term length and the amount borrowed.

Here are four tips to getting the best rate on your home equity loan:

  1. Increase your credit score. The best home equity loan rates are available for borrowers with FICO scores of 740 and up and debt-to-income ratios of under 43%. The higher your credit score and the lower your DTI, the better the rate you can potentially get.
  2. Choose a shorter loan term. Some lenders offer more competitive rates on short-term loans like seven or 10 years. As of July 2022, Connexus is offering a very competitive 4.15% APR on its home equity loan, but with a short five-year repayment term.
  3. Choose a higher loan amount. You can often get a better rate if you borrow a larger amount, but this only makes sense if you need it or you can pay the loan off early without penalty. If you’d prefer a revolving credit line or varying amounts, a HELOC may be more suitable.
  4. Compare multiple lenders. Every lender has different offerings, and simply comparing different loans could mean significant savings. Remember to add any closing costs and origination fees into your calculation, as these affect your APR.

What’s the current average home equity rate?

Right now, interest rates on home equity loans are fluctuating between 3.25% to 7.94%, according to Bankrate, with an average rate of 5.96% as of July 2022. However, the rate your lender offers depends primarily on your credit score as well as the loan’s amount and term.

4 more factors to consider

When choosing a home equity loan, consider factors beyond just the advertised interest rate. Here are a 4 things to keep in mind:

  1. APR. The APR is the annualized interest rate you pay once all costs and fees are factored into a loan. If your loan has closing costs or origination fees, this pushes the APR up.
  2. Prepayment penalties. Ask if the loan carries any prepayment penalties in case you want to pay your loan off early and save on interest.
  3. Term length. The longer the term repayment period you choose, the lower your monthly payment will be, but the more interest you’ll pay over the loan’s life.
  4. Relationship discounts. You can often get 0.25% or 0.50% off your rate If you set up autopay on your loan or open a checking account, but this doesn’t guarantee you’re getting the lowest rate.

Is a home equity loan the best option?

A home equity loan isn’t the only way to tap into your home’s equity. Here are some more options for accessing cash:

  • Home equity line of credit (HELOC). This is a revolving line of credit with a variable interest rate that you draw from for 10 years making interest-only payments, and repay over 20 years. Compare top HELOC lenders.
  • Cash-out refinance. A cash-out refinance mortgage replaces your current mortgage with one for a greater amount, so you can “cash out” the difference. Learn more about how cash-out refis work.
  • Personal loan. Personal loans typically offer borrowing amounts from $500 to $100,000 and have no collateral requirements — but interest rates will likely be higher than for a home equity loan. Compare some of the best personal loans.

Bottom line

The home equity loan market is competitive, so shop around and compare multiple lenders to get the best deal on rates, closing costs and fees. But because you’re taking on more debt with this type of product, understand the risks and benefits of home equity loans. To learn more, see our guide to home equity loans.

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