Where to get a home equity loan or HELOC: finding the best lender

Core Insights - The article discusses various options for obtaining home equity loans and lines of credit (HELOCs), emphasizing the importance of comparing rates and terms from different lenders to find the best deal. Group 1: Types of Lenders - Multi-state retail banks like Bank of America, Citizens Bank, and PNC Bank are significant players in home equity financing, often providing the largest HELOC credit lines [2] - Credit unions and savings and loan associations originated over 90% of HELOCs in Q2 2025, according to TransUnion, and typically offer larger home equity loan amounts [7] - Non-bank mortgage lenders, including independent mortgage companies and online lenders, often provide more competitive terms and flexible requirements compared to traditional lenders [8] Group 2: Home Equity Products - Home equity is defined as the difference between a home's current value and the remaining mortgage balance, which can be borrowed against through HELOCs or home equity loans [4] - HELOCs are credit lines with variable interest rates, while home equity loans are fixed-rate second mortgages [4] - The amount that can be borrowed through home equity loans and HELOCs can range from $10,000 to a maximum of $1,000,000, depending on the lender and the homeowner's equity [22] Group 3: Application Process and Requirements - To apply for a home equity loan, borrowers typically need to provide documentation such as proof of income, employment history, and property ownership [21] - Common requirements include having at least 15% to 20% equity in the home, a credit score in the mid to high-600s (preferably 700 or above), and a debt-to-income ratio of no more than 43% [20] - The approval process for home equity loans can be more stringent than for regular mortgages, with a denial rate for HELOCs around 38% [25]