Best Home Equity Loans 2023

A Home equity loan A fixed-rate, second mortgage allows you to borrow against the equity in your home. These installment loans give you access to funds for virtually any purpose, including High interest debt consolidationPay for major expenses and cover state of emergency.

If you’re thinking about tapping into your home equity, you’ll find home equity loan offers from many national and regional banks, credit unions and online lenders. As you might expect, loan options and loan requirements vary from lender to lender. We’ve created this guide so you can identify partner lenders that offer the best home equity loans in different categories.

You can now easily explore your local home equity loan options.

Best Home Equity Loans 2023

Here are some of the best home equity loan lenders currently available.

Best Overall: Discovery

While choosing a home equity loan with the lowest annual percentage rate (APR) can save you thousands of dollars over time, it’s important to consider other factors as well. It is wise to balance the loan limits, repayment terms, fees and other factors to make a decision that suits your needs.

Along these lines, Discover is our pick for the best overall home equity loan that checks all the boxes, such as:

• Competitive Rates: Fixed rate APR starts at 6.24% until April 2023.
• Generous Equity Access: While most lenders allow you to access 80% to 85% of the home’s value, Discover’s home equity loans offer loan-to-value (LTV) rates of up to 90% if qualified.
• Higher Loan Limit: Home equity loans range from $35,000 to $300,000.
• Flexible Payment Options: Loan repayment terms are for 10, 15, 20 or 30 years. Shorter repayment terms usually result in higher monthly payments, but you’ll save more in interest over the life of the loan. Conversely, longer terms result in lower monthly payments, but you’ll pay more in interest overall.
• No Origination Fee: Discover does not require appraisal fees, mortgage taxes or cash at closing.

Learn more here now.

Best for Com April: Third Federal

As of April 2023, Third Federal offers 6.49% and 6.99% APR for 5- and 10-year home equity loans, respectively. The lender also offers a lowest rate guarantee that states, “Third Federal will pay you the lowest interest rate on a similar home equity loan (HELOAN) offered by a duly licensed lender, or pay you $1,000.” Loan amounts range from $10,000 to $200,000 with a maximum LTV of 80%.

If you live in Florida or Ohio, you may qualify for a Third Federal fixer upper home repair loan. This program is designed for homeowners looking for a small cash infusion between $1,000 and $9,900 for a home renovation project. The loan comes with 2.99% APR and monthly payments as low as $10.

Best for home improvement: Flagstar

Flagstar is the largest mortgage loan originator in the United States. Lender home equity loans can be ideal for homeowners with high-value homes and enough equity that they can access to cover renovations.

Whether you want to use Home equity to repair or create extra space, Flagstar Bank offers loan amounts that should fit the home equity loan bill. Typically, loan amounts range from $10,000 to $1,000,000 with repayment terms of 10, 15 or 20 years. Interest rates start at 8.04%. Unfortunately, Flagstar does not offer home equity loans in every state, so contact the lender to check loan availability in your area.

Best for Debt Consolidation: Rocket Mortgage

Many Americans are carrying large amounts of consumer debt. According to ExperianTotal consumer debt balances rise to $16.38 trillion in 2022, up nearly $1 trillion from the previous year.

Experts advise you to use only Home equity loans for emergencies Such as unexpected medical expenses and emergency debt consolidation. But, if alternative options are not available, a Home equity loan or HELOC If you can consolidate high-interest loans into a low-interest loan, your budget can be relieved. Consider getting a home equity loan quote from Rocket Mortgage to see if a new loan can ease the strain on your budget and save you money on potential interest charges.

Rocket Mortgage is a reputable home loan lender offering home equity loans ranging from $45,000 to $350,000 and repayment terms between 10 and 20 years. Rates vary depending on your credit, equity and other factors. For example, we are quoted a 6.375% APR on a 30-year fixed-rate home equity loan for a California homeowner.

To qualify, you’ll need a minimum FICO Credit score 680, and your debt-to-income ratio must be 45% or less.

Explore your home equity loan options now and start consolidating your debt at low rates.

Best for borrowers with excellent credit: US Bank

US Bank offers home equity loans to borrowers with a credit score of 660 or higher and who meet eligibility criteria. However, a higher credit score can help you qualify for more favorable terms. US Bank is the best home equity lender for borrowers with excellent credit because it offers low APRs for borrowers with at least a 730 credit score.

As of April 2023, US Bank offers them 7.50% APR for a 10-year term and 7.45% APR for a 15-year term. Home equity loan. These rates apply to loans from $50,000 to $90,000 with up to a 60% LTV. To get the lowest rate, you must have a credit score of at least 730 and set up automatic payments from a US bank personal checking or savings account.

Best for borrowers with bad credit: Discover

Our list of the best home equity loans ends where it began. Discover earned the Best Overall Home Equity Loan honor because it excelled in numerous categories, including this one.

With a minimum credit score requirement of 620, Discover’s home equity loans help borrowers who may have limited options due to bad credit. Like other lenders, Discover considers credit history, employment, income, amount of equity and other factors when reviewing home equity loan applications.

Of course, a higher credit score opens you up to more favorable terms, such as borrowing limits above 80% LTV. Discover also notes that loan requests over $150,000 require a credit score of 700 or higher.

Bottom line

As with other financial products, shopping and comparing multiple home equity loan lenders can help you narrow down your choices and identify the best home equity loan for your situation. Run the numbers, including interest rates, fees, appraisals and cash needed at closing, to make sure they make financial sense before taking on a new loan. Start shopping for home equity loan lenders here or through the table below.