Best HELOC Rates in 2025: Home Equity Loan vs. Line of Credit
Meta: See the latest 2025 HELOC and home equity loan averages, who qualifies, and how to choose between a HELOC vs. fixed home equity loan.
TL;DR Summary (Fact-Checked):
- Average HELOC APR: ~7.64%–7.82% in early November 2025 (Curinos/Bankrate).
- Average Home Equity Loan APR: ~8.02%–8.20% (Bankrate/CBS roundup, 10–15 year terms).
- Discover home equity loans: new applications discontinued in 2025 after the Capital One acquisition.
- Equity context: Q2 2025 average borrower equity ≈ $307,000 (Cotality/CoreLogic). “Tappable” amounts vary by lender/underwriting and were not published for Q3 2025 at time of writing.
- Rate outlook: Economists are mixed; some expect a late-2025 cut and possibly a few modest cuts in 2026, but projections vary—plan for variability.
With first-mortgage refinancing still muted, homeowners are tapping equity through HELOCs (home equity lines of credit) and home equity loans. Below we compare today’s averages, explain how each product works, and show when a HELOC or a fixed home equity loan makes more sense in 2025.
Current Averages (Updated November 2025)
| Product |
National Average APR |
Typical Range (Recent) |
Rate Type |
Notes |
| HELOC |
~7.64%–7.82% |
≈7.6%–7.9% (week of Nov. 10) |
Variable (Prime + margin) |
Curinos weekly avg ~7.64%; Bankrate daily avg ~7.82% (Nov 5–10). |
| Home Equity Loan |
~8.02%–8.20% |
≈8.0%–8.3% (10–15 yr terms) |
Fixed |
Bankrate average ~8.02% (Nov 5); CBS roundup ~8.1%–8.2%. |
Averages are national and can differ by lender, credit profile, CLTV/LTV, loan size, term, and discount programs (autopay, relationship banking). Always verify real-time quotes before applying.
HELOC vs. Home Equity Loan—Key Differences
| Feature |
HELOC (Line of Credit) |
Home Equity Loan (Fixed) |
| Rate |
Variable, tied to Prime + margin; some allow fixing portions |
Fixed for entire term |
| Funds |
Draw as needed during draw period |
Lump-sum disbursement at closing |
| Best Use |
Ongoing/uncertain costs (multi-stage remodels, tuition) |
One-time projects with defined budget |
| Tax Deduction |
Interest may be deductible if used to buy/build/substantially improve the home (IRS Pub. 936) |
Same rule as HELOC |
Top Lenders in 2025 (Features to Compare)
Leading names include U.S. Bank, Bank of America, Figure Home Equity, and regional credit unions. Compare:
- APR & margins: Intro discounts vs. long-term margins over Prime.
- Fees: Annual fees, early termination fees, appraisal/closing costs.
- Draw period & repayment: Commonly 10-yr draw with 10–20-yr repayment; some allow interest-only during draw.
- Fix-a-portion: Ability to convert part of a variable HELOC to a fixed-rate sub-loan.
- Funding speed: Digital lenders (e.g., Figure) often fund faster than banks.
Important update: Discover stopped accepting new home equity loan applications in 2025 following the Capital One acquisition. If you were considering Discover, compare alternatives from banks/credit unions or digital lenders instead.
How Much Equity Do Homeowners Have in 2025?
Industry data show total homeowner equity around $17.5 trillion in mid-2025. The average borrower’s equity was roughly $307,000 in Q2 2025. Note this is not the same as “tappable” equity; lenders cap combined loan-to-value (CLTV) and apply other underwriting rules when determining how much you can borrow.
When to Choose a HELOC vs. Fixed Home Equity Loan
- Pick a HELOC if you need flexibility, expect staged costs, or want optional interest-only payments during the draw period.
- Pick a Home Equity Loan if you prefer payment certainty and have a defined project budget.
- Hybrid approach: Use a HELOC with “fix-a-draw” features to lock in portions as rates move.
Example: Payments at Today’s Averages
Assume a $75,000 balance:
| Product |
Rate |
Term |
Est. Payment* |
Notes |
| HELOC (repayment phase) |
7.75% variable |
20 yrs amort. |
≈ $616/mo |
Payment can change if Prime moves |
| Home Equity Loan |
8.10% fixed |
15 yrs |
≈ $721/mo |
Payment fixed for life of loan |
*Estimates exclude closing costs, annual fees, and any promotional discounts. For HELOCs in the draw period, minimum payments may be interest-only.
Qualifying for the Best Rates
- Credit score: 700+ typically gets better margins; 660–699 may qualify with higher margins.
- CLTV: Many lenders cap HELOCs at ≤80–85% CLTV; lower CLTV improves pricing.
- DTI: Aim for ≤43% (lower is better); bolster with cash reserves.
- Discounts: Ask about autopay/relationship discounts and “fix-a-portion” options.
Rate Outlook
Forecasts vary. Some economists expect the Fed to deliver a late-2025 cut and potentially a few modest cuts in 2026, while others see a slower path. Because HELOCs track Prime (which moves with the Fed funds rate), plan for rate volatility rather than banking on large, immediate declines.
Key Takeaways
- HELOC averages are in the high-7% range; fixed home equity loans hover near ~8.1% as of early November 2025.
- Choose a HELOC for flexibility, a fixed loan for certainty—or a hybrid if your lender allows.
- Compare at least three quotes and read fee schedules (annual, early closure, appraisal, origination).
- Interest may be deductible only when proceeds improve the home (see IRS Publication 936).
Sources / Official References:
Disclaimer: Information is for educational purposes only and not financial advice. Rates, terms, and lender programs change frequently; always confirm details with the lender and consult a qualified advisor.
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