HELOC and home equity loan rates Saturday, March 28, 2026: Rates hold above 7%

Core Insights - Second mortgage products, particularly HELOCs and home equity loans, are becoming increasingly popular as primary mortgage rates remain above 6% and the prime rate is near a three-year low [1] Interest Rates - The average HELOC rate is currently 7.20%, with a low of 7.19% recorded in mid-January [2] - The national average rate for home equity loans stands at 7.47%, with a low of 7.38% noted in early December [2] - Home equity interest rates are calculated based on an index rate plus a margin, typically using the prime rate, which is currently at 6.75% [4] Market Dynamics - Homeowners with low primary mortgage rates may find it challenging to access the growing equity in their homes, making second mortgages like HELOCs or home equity loans a viable solution [3] - Each lender has its own pricing methodology for second mortgage products, influenced by factors such as credit score and debt levels [5] Loan Features - HELOCs offer flexibility in borrowing against home equity, allowing homeowners to withdraw and repay as needed, while home equity loans provide a lump sum with a fixed interest rate [9] - Introductory rates for HELOCs can be significantly lower than market rates, but they typically convert to variable rates after an initial period [8] Borrowing Considerations - Homeowners with significant equity and low primary mortgage rates may find it advantageous to obtain a HELOC or home equity loan for various uses, including home improvements [12] - Monthly payments on a $50,000 HELOC at a 7.25% interest rate would be approximately $302 during the draw period, but payments may increase during the repayment period due to variable rates [13]