HELOC and home equity loan rates Monday, January 26, 2026: Here are the benchmark rates to shop for

Core Insights - Average rates for home equity lines of credit (HELOC) and home equity loans (HEL) are approaching 7%, marking the lowest levels in years [1] Group 1: Current Rates - The average HELOC rate is currently 7.25%, while the national average for home equity loans is 7.56% [2] - These rates are applicable to applicants with a minimum credit score of 780 and a maximum combined loan-to-value ratio (CLTV) of less than 70% [2] Group 2: Product Benefits - A HELOC allows homeowners to draw from an approved line of credit as needed, while a home equity loan provides a lump sum [3] - Homeowners with low primary mortgage rates may find HELOCs or HELs beneficial to access their home equity without losing their favorable mortgage rate [4] Group 3: Rate Structure - HELOC interest rates differ from primary mortgage rates, being based on an index rate plus a margin, with the current prime rate at 6.75% [5] - A typical HELOC rate could be around 7.50% if a lender adds a margin of 0.75% [5] - Home equity loans generally have a fixed interest rate, making them less likely to feature introductory rates [7] Group 4: Lender Considerations - Lenders have flexibility in pricing second mortgage products, making it essential for borrowers to shop around for the best rates [6] - Average national HELOC rates may include introductory rates that last for a limited time before becoming adjustable [6] Group 5: Best Offers - FourLeaf Credit Union currently offers a HELOC rate of 5.99% for the first 12 months on lines up to $500,000, which will convert to an adjustable rate thereafter [8] - The best home equity loan lenders typically offer fixed rates for the duration of the repayment period, simplifying the borrowing process [9] Group 6: Payment Insights - For a $50,000 HELOC at a 7.50% interest rate, the monthly payment during the 10-year draw period would be approximately $313, but this rate is variable and may increase during the repayment period [13]