HELOC and home equity loan rates today, January 2, 2026: Lenders reprice to a lower prime rate

Core Insights - The national average rates for home equity lines of credit (HELOC) and home equity loans have decreased, with the prime rate currently at 6.75% and both products nearing or just below 7.5% [1] Interest Rates - The average HELOC rate is reported at 7.44%, while the national average for home equity loans stands at 7.59% [2][11] - Interest rates for HELOCs and home equity loans are influenced by the prime rate, which has dropped due to recent Federal Reserve rate cuts [5][7] Home Equity Value - Homeowners have approximately $36 trillion in home equity as of Q2 2025, marking the highest recorded amount [3] - With mortgage rates remaining low, homeowners are less likely to sell their homes or refinance, making HELOCs and home equity loans attractive options for accessing home equity [3] Lender Practices - Lenders determine HELOC and home equity loan rates based on an index rate plus a margin, with flexibility in pricing depending on individual borrower factors [5][6] - Lenders are adjusting their rates downward in response to the lower prime rate, with some offering competitive introductory rates [7][8] Borrowing Considerations - Borrowers should compare rates, fees, repayment terms, and minimum draw amounts when selecting lenders for HELOCs or home equity loans [8][9] - The current environment suggests that obtaining a HELOC or home equity loan is favorable, especially for home improvements and repairs [12]