Image: Getty Images; Illustration: Bankrate
Home equity rates fell this week, reaching their lowest levels in about three years. The $30,000 home equity line of credit fell one basis point to 7.31%, according to Bankrate’s national survey of lenders. Meanwhile, the five-year $30,000 home equity loan fell three basis points to 7.89%.
While rates can influence the home equity product you decide to take, they’re not the only factor at play. Homeowners generally hold substantial equity, but growth is moderating in some parts of the country, says Kenon Chen, executive vice president of strategy and growth for Clear Capital, a real estate analytics data firm. Prices are also softening, along with housing supply in some areas.
“It’s something for people to consider with the type of loan that they might take out,” he says. “Are they taking out a lump sum upfront with a closed-end home equity loan? [They should] get a clear understanding of where they’re at with their loan-to-value ratio. Or if they’re getting a home equity line of credit, they should consider the trajectory of their home prices as they’re thinking about drawing on that credit line.”
| Current | 4 weeks ago | One year ago | 52-week average | 52-week low | |
| HELOC | 7.31% | 7.44% | 8.29% | 7.96% | 7.31% |
| 5-year home equity loan | 7.89% | 7.98% | 8.41% | 8.18% | 7.89% |
| 10-year home equity loan | 8.07% | 8.16% | 8.55% | 8.34% | 8.07% |
| 15-year home equity loan | 8.06% | 8.11% | 8.50% | 8.27% | 8.06% |
| Note: The home equity rates in this survey assume a line or loan amount of $30,000. | |||||
What’s driving home equity rates today?
Home equity rates are driven primarily by two factors — Federal Reserve policy and long-term inflation expectations. The Fed left interest rates unchanged at its January meeting, as it continues to monitor inflation and the job market. Looking ahead to the rest of the year, Bankrate’s senior industry analyst Ted Rossman forecasts the Fed will deliver three quarter-point cuts in 2026.
“Inflation continues to moderate, albeit slowly, and the job market appears to be stabilizing after a run-up in the unemployment rate,” he says. “Risks appear fairly balanced at the moment, and the Fed will likely take some time to determine its next move. We’re soon to get a new Fed Chairman, as well.”
Current home equity rates vs. rates on other types of credit
Because HELOCs and home equity loans use your home as collateral, their rates tend to be much less expensive — more akin to current mortgage rates — than the interest charged on credit cards or personal loans, which aren’t secured.
| Credit type | Average rate |
| HELOC | 7.31% |
| Home equity loan | 7.89% |
| Credit card | 19.60% |
| Personal loan | 12.15% |
| Source: Bankrate national survey of lenders, Feb. 18 | |
While average rates are useful to know, the individual offer you receive on a particular HELOC or new home equity loan reflects additional factors, like your creditworthiness and financials. Then there’s the value of your home and the size of your ownership stake. Lenders generally limit all your home loans (including your mortgage) to a maximum of 80% to 85% of your home’s worth.
Keep in mind: Even if you’re able to secure a favorable rate from a lender, home equity products are still relatively high-cost debt.
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A fixed-rate home equity loan offers a lump-sum payout and a predictable repayment schedule.
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Home equity trends
- On average, mortgage-holding homeowners’ equity stakes have risen 142% nationwide since 2020, according to a Bankrate study on states with the most and least home equity gains.
- In Q4 2025, mortgage holders had $11.2 trillion in tappable equity, marking the slowest growth in over two years, according to the ICE November Mortgage Monitor.
- Balances on HELOCs rose in the fourth quarter of 2025 by $12 billion, increasing for the 15th consecutive quarter, according to the Federal Reserve Bank of New York.
- The average homeowner lost approximately $13,400 in equity during the past year, leaving borrowers with about $299,000 in home equity, according to Cotality.
- Housing wealth for senior homeowners aged 62 and older climbed to a record high of $14.66 trillion in the third quarter of 2025, according to the National Reverse Mortgage Lenders Association.
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