HELOC rates today, October 4, 2025: Your introductory rate might last through two more interest rate cuts

Core Insights - The average rate on a home equity line of credit (HELOC) is currently just below 8.5%, with Bank of America reporting an average APR of 8.47% for a 10-year draw HELOC, which is a variable rate that follows a six-month introductory rate of 5.99% [1][2] - Homeowners have over $34 trillion in home equity, the third-largest amount on record, making HELOCs an attractive option for accessing this equity without selling homes or refinancing low-rate primary mortgages [2][11] - Lenders determine HELOC interest rates based on an index rate plus a margin, with the current prime rate at 7.25%, leading to potential rates around 8.25% depending on lender margins [4][5] HELOC Usage and Benefits - HELOCs allow homeowners to tap into their home equity without giving up their low-rate primary mortgage, providing flexibility in borrowing and repayment [6][9] - Homeowners can use HELOC funds for various purposes, including home improvements, repairs, and even discretionary spending, as long as they manage repayment responsibly [11] - The structure of HELOCs enables borrowers to only pay interest on the amount drawn, making it a cost-effective way to access funds as needed [9] Market Dynamics - Current HELOC rates vary significantly among lenders, ranging from nearly 6% to as high as 18%, influenced by individual creditworthiness and lender competition [10] - Introductory rates, such as FourLeaf Credit Union's offering of 5.99% for 12 months, can provide initial savings but will convert to variable rates later, necessitating careful comparison of terms and fees [8][11] - Monthly payments for a $50,000 HELOC can be approximately $384, with variable interest rates starting at 8.49%, highlighting the importance of understanding the long-term implications of borrowing [12]