National average rates for second mortgage home equity loans and lines of credit are near their lowest levels in more than three years. You can access your home equity at these very favorable rates.
The average HELOC rate is 7.23%according to the real estate analysis firm Curinos. The national average home equity loan rate is 7.44%. Rates are based on applicants with a minimum credit score of 780 and a maximum combined loan-to-value (CLTV) ratio of less than 70%.
With mortgage rates remaining near 6%, homeowners are unlikely to walk away from their lower primary mortgage anytime soon, so selling a home may not be an option. A cash-out refinance may not be feasible either. Why give up your 5%, 4% or even 3% mortgage?
Accessing some of that equity with an as-needed HELOC or home equity loan can be a great alternative.
Home equity interest rates are calculated differently than mortgage rates. Second mortgage rates are based on an index rate plus a margin. That rate is usually the prime rate, which is now 6.75%. If a lender added 0.75% as margin, the HELOC would have a variable rate of 7.50%.
A home equity loan may have a different margin because it is a fixed interest product.
Lenders have flexibility with the pricing of 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 have, and the size of your line of credit compared to the value of your home. Shop a few lenders to find your best interest rate deal.
Today, FourLeaf Credit Union offers a 5.99% HELOC APR for 12 months on lines up to $500,000. This is an introductory rate that will convert to a variable rate in one year.
When shopping for lenders, keep both rates in mind. And as always, compare the fees, payment terms and minimum withdrawal amount. The withdrawal is the amount of money a lender requires you to initially withdraw from your equity.
The best home equity loan lenders may be easier to find because the fixed rate you earn will last the entire repayment period. That means just one rate to focus on. And you will receive a lump sum, so there are no withdrawal minimums to consider.
Rates vary significantly from lender to lender. You may see rates from 6% to 18%. It really depends on your creditworthiness and your diligence as a buyer. Currently, the national average for a HELOC is 7.23% and for a home equity loan it is 7.44%.
Interest rates fell through most of 2025. They are expected to remain stable through the first half of 2026. So, yes, it’s a good time to get a second mortgage. And with a HELOC or HEL, you can use the cash withdrawn from your equity for things like home improvements, repairs, and upgrades. Or almost anything else.
If you withdraw the entire $50,000 from a home line of credit and pay an interest rate of 7.25%, your monthly payment over the 10-year withdrawal period would be approximately $302. That sounds good, but remember that the rate is usually variable, so it changes periodically and your payments will increase over the 20-year repayment period. A HELOC essentially becomes a 30-year loan. HELOCs are better if you borrow and pay off the balance in a much shorter period of time.