HELOC Rates Hit 2022 Low: Home Equity Loan Rates Stable

For homeowners looking to tap into their property’s value, borrowing costs just became more attractive. The average rate on a home equity line of credit (HELOC) recently fell to 7.04%, the lowest level seen since 2022. Meanwhile, rates on fixed-rate home equity loans are holding steady, providing stability for those who prefer predictable monthly payments.

The Current Rate Landscape

Homeowners are finding some of the most affordable home equity borrowing rates in years. According to Bankrate's national survey of lenders, which assumes a loan amount of $30,000, rates have dropped significantly compared to one year ago.

Here’s a look at the current national averages:

• HELOC: The average rate is now 7.04%, a noticeable decrease from 8.01% a year ago.
• 5-year home equity loan: This rate held steady at 7.85%, down from 8.37% last year.
• 10-year home equity loan: The average rate is 8.00%, compared to 8.50% one year prior.
• 15-year home equity loan: Currently at 7.97%, this is down from 8.44% a year ago.

What's Influencing These Rates?

The primary drivers behind home equity rates are the Federal Reserve's monetary policy and the outlook on long-term inflation. At its policy meeting in March, the Fed opted to leave its benchmark interest rate unchanged. This decision reflects an ongoing effort to balance economic growth with taming inflation.

According to Bankrate senior industry analyst Ted Rossman, home equity borrowing rates are "currently hovering around three-year lows." However, due to persistent inflation, earlier predictions for more aggressive rate cuts have been scaled back. Understanding how the Federal Reserve affects HELOCs and home equity loans can help borrowers anticipate future rate movements.

Home Equity Products vs. Other Forms of Credit

One of the biggest advantages of tapping into your home’s equity is the cost. Because these products are secured by your home, lenders consider them less risky and offer significantly lower interest rates than unsecured debt.

Consider how these borrowing costs compare:

• HELOC: 7.04%
• Home equity loan: 7.85%
• Credit card: 19.58%
• Personal loan: 12.27%

The difference is clear: using home equity to consolidate high-interest credit card debt or finance a major home renovation could save you thousands of dollars in interest payments.

Recent Trends in Home Equity

The current rate environment comes at a time when many homeowners are sitting on a substantial amount of equity. Since 2020, the average equity stake for mortgage-holding homeowners has surged by 142% nationwide. You can see a breakdown of states with the most and least home equity gains in a recent Bankrate study.

This wealth is primarily being tapped by older generations. In the third quarter of 2025, Gen X and Baby Boomers were the largest groups of HELOC borrowers, at 38% and 30%, respectively.

However, the picture isn't rosy for everyone. More than 1.1 million borrowers ended 2025 with negative equity. Furthermore, serious delinquencies on HELOCs (payments 90 days or more overdue) rose to 1.24% in the fourth quarter of 2025, a significant jump from 0.56% in the same period a year earlier.

What This Means for You

Despite some cautionary signs in the market, Michael Pearson of A&D Mortgage notes that "Homeowners have a tremendous amount of equity in their property." If you're considering borrowing against your home, now may be an opportune time to lock in a favorable rate.

Keep in mind that the offer you receive will depend on your personal financial situation, including your credit score, income, and existing debts. Lenders typically limit your total mortgage-related debt to between 80% and 85% of your home’s appraised value.

To secure the best terms, it’s essential to shop around. By comparing different lenders, you can explore offers and find a favorable rate from a lender that fits your financial goals.