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Best home equity loan lenders for 2019

Peter Warden
The Mortgage Reports editor

In this article:

To find the best banks for home equity loans, you’ll want to choose your product and then find the best deal.

  1. Home equity loans can be fixed loans or lines of credit
  2. Once you choose a product you’ll want to compare rates and terms from several lenders
  3. Then compile a short list of competitive lenders and work with the one that provides the best service
Verify your new rate (Oct 22nd, 2019)

How to find the best banks for home equity loans

Home equity interest rates and costs vary widely. So when searching for the best banks for home equity loans 2019, get at least three quotes from different lenders. Only when you have multiple quotes can you properly compare interest rates and costs.

Home equity products, which are second mortgages, secured by your home, come in two main flavors:

  1. Home equity loans (HELs) — You borrow a lump sum and pay it back in equal installments, over a fixed term, usually at a fixed interest rate
  2. Home equity lines of credit (HELOCs) — You’re given a credit limit and can borrow as much or as little as you want up to that limit. You only pay interest on balances and can pay down and reborrow as often as you want, at least during the initial “draw” period. Rates tend to be variable

The best loan for you depends on how you plan to use the money. In general, the HEL is best when you know how much you’ll need and want a larger sum. The HELOC is nice for flexibility and for smaller amounts.

Our picks

Here are our recommendations for borrowers in certain situations. If your circumstances place you in one such group, you might want to apply to the lender we suggest. But you’ll still want to make other applications so you can compare quotes.

  • Best loan for people with credit issues — Discover
  • Best loan for low rates —  Citizens Bank
  • Best loan for maximum cash out —  Discover
  • Best loan for people who hate applying for mortgages in person (best online experience) —  PNC
  • Best loan for people who hate applying for mortgages online (best branch network) — Bank of America

Here is a fuller rundown of the top home equity lenders in the US.

Bank of America home equity loan

The bank can trace its history all the way back to 1784. It now has 67 million consumer and small business clients and around 4,400 “retail financial centers.”

Better Business Bureau rating: A+ (accredited business)

Of course, every business with so many customers will have plenty who are dissatisfied. Those posting comments on the BBB website seemed mostly to have customer service issues. While each complaint is annoying for the individual client, the numbers (out of 67 million) are small and Bank of America has earned its place on our list of the best banks for home equity loans.

Loans on offer

Bank of America offers only home equity lines of credit (HELOCs) — no home equity loans. However, customers can fix at any time the interest rate on some or all of the outstanding balance.

The minimum line of credit you can apply for is $25,000. The normal top limit is $1 million, but clients of the bank’s wealth management service may be able to borrow more.

Will you qualify?

The bank is unusually open about its lending criteria:

  • Minimum credit score (FICO): 660
  • Maximum loan-to-value ratio: 85 percent

It doesn’t specify a maximum debt-to-income ratio and says that “varies based on client and loan characteristics.”

How much?

At the time of writing, the bank is offering a low variable introductory rate for one year. The actual figures may vary from state to state, but one example given is 3.740 percent for the first 12 months, reverting to 6.080 percent thereafter. Of course, the interest rate you’re offered will vary depending on how attractive a borrower you are: your credit score and so on.

The bank promises no fees or closing costs on opening, no annual fees and no balance transfer or cash advance fees.

You can get a 0.25 percent discount on your interest rate if you make payments from a Bank of America account using autopay. You may also be eligible for another discount: “Make an initial withdrawal when you open your account and receive a 0.10 percent interest rate discount for each $10,000 withdrawn (up to a maximum discount of 1.50 percent),” according to the bank’s website. Finally, members of the bank’s Preferred Rewards program may get further interest-rate discounts up to a maximum of 0.375 percent. Check the website for terms and conditions.

Application experience

It should take you about 15 minutes to complete an online application. You can later securely upload documents using this service.

Alternatively, you can visit one of the bank’s 4,400 branches or reach out to its call center.

BB&T home equity loan

Branch Banking and Trust Company has 1,900 financial centers in 15 states (Alabama, Washington DC, Florida, Georgia, Indiana, Kentucky, Maryland, North Carolina, New Jersey, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia and West Virginia) plus Washington, D.C.

Better Business Bureau rating: A+ (accredited business)

As with all big financial institutions, BB&T has some poor customer reviews on the BBB website. These mostly relate to customer service.

Loans on offer

The bank offers both home equity loans and HELOCs.  The latter comes with an option that allows you to fix your interest rate and term for all or part of your loan.

As you’d expect, BB&T’s home equity loans come with a fixed rate as standard.

Will you qualify?

The bank does not reveal its thresholds for credit scores, loan-to-value ratios or debt-to-income ratios. You can pop into a branch to explore with a loan officer your chances of getting approved.

How much?

The HELOC comes with an introductory offer that gets you an ultra-low interest rate for the first six months. The bank says these lines of credit come with “low set-up fees” and a no-closing-costs option.

The website makes no such promises for home equity loans. You may be able to assume these are competitive, but it’s worth comparing costs with those of other lenders.

Application experience

You can complete an online application for home equity loans. And you can make applications in-branch. The BB&T call center can answer many questions.

You can’t apply for a HELOC online. Instead, you need to visit a branch. Again, the call center may be able to help with questions.

Chase home equity loan

Chase claims to serve nearly half of American households. It is part of JPMorgan Chase & Co., which is a global organization with assets of $2.6 trillion.

Better Business Bureau rating for Chase Home Finance: A+ (not an accredited business)

Loans on offer

Chase does not offer home equity loans on its website. It does, however, provide home equity lines of credit.

These come with variable interest rates as standard. But it is possible to fix your rate for some or all of your balance.

Chase’s “draw” period (the time during which you can borrow) is at 10 years fairly standard. But you can have up to 20 years for your “repayment” period when you can’t borrow any more and over which time you must zero your balance.

Will you qualify?

You’ll typically need a credit score of 680 or better. Assuming that you meet other criteria, you may be able to borrow up to 80 percent of the market value of your home. That 80 percent will include any existing mortgage along with all other loans secured on the property.

Chase says it usually likes your debt-to-income ratio (the percentage of your monthly income that goes out on debt payments, including your new HELOC) to be 43 percent or less. However, that can be as high as 50 percent in exceptional circumstances.

The bank does not offer HELOCs in Alaska, Hawaii or South Carolina.

How much?

Chase publishes a rough guide to current rates, although these will be affected by many factors, including your credit score and where you live.

On the day this was written (they may have changed by the time you read this), the very minimum you could pay was 5.5 percent APR. The maximum was 7.89 percent for loans under $100,000, falling to 7.39 percent APR for bigger amounts. Chase customers may be eligible for discounted rates, which vary depending on their level of engagement with the bank.

Application experience

You can apply online and the process is likely to take about 15 minutes. Be aware that leaving the screen before submitting your application will mean you’ll have to re-enter all your information later. There’s a phone number if you require help or additional information.

If you prefer, you can make an appointment with your nearest branch to have a face-to-face meeting with a home lending advisor.

Citizens Bank home equity loan

The bank claims to be the 13th largest retail bank in the country and to serve 5 million customers. It has 1,150 branches in 11 states in the New England, Mid-Atlantic and Midwest regions.

Better Business Bureau rating: A+ (not an accredited business)

Loans on offer

Citizens Bank offers both HELs and HELOCs. You can choose your term for a HEL from 10 years, 15 years or 20 years.

Will you qualify?

The bank doesn’t specify a minimum credit score or maximum debt-to-income ratio. Your maximum loan-to-value ratio is 80 percent, meaning your total borrowing secured by your home can’t exceed 80 percent of its market value.

How much?

You can get a 0.25 percent discount on your rates if you use autopay for payments from a Citizens checking account. The following minimum rates (all shown as APRs and which may have changed by the time you read this) assume you do and include that discount and decrease as the loan amount increases:

  • < $49,999: 7.25 percent (HELOC)
  • $50,000 – $99,999: 5.50 percent (HELOC)
  • $100,000+: 4.75 percent (HELOC)
  • $10,000-$49,999: 7.74 percent (HEL) for a 10-year term, rising to 8.79 percent for a 20-year term

You can find numerous other rates for HELs of different terms and amounts on the bank’s website, including those for a first-lien HEL. The rate you actually pay depends on your credit score, debt-to-income and loan-to-value ratios,  and where you live.

Application experience

You can begin your application process online. However, the information you supply is scant and is intended to trigger a call from a loan officer. You can also begin the process and have questions answered via the call center. If you have a local branch, it may be easier to make an appointment with a loan officer there.

Discover home equity loan

Largely thanks to its credit cards, Discover is one of the most widely recognized brands in the country. So it will surprise some that it was only launched in 1986. Discover Financial Services is a direct banking organization, meaning it doesn’t have a branch network as such.

Discover Home Equity Loans was established only in 2017. For that reason (and that reason only) it has a C- rating with the Better Business Bureau. Its parent Discover Financial Services gets an A+ rating and is an accredited business.

Loans on offer

The company offers only home equity loans with fixed interest rates. HELOCs are not available.

HELs come with a variety of terms: 10, 12, 15, 20 or 30 years.

Will you qualify?

Discover is upfront about its lending criteria for home equity loans:

  • Minimum credit score: 620
  • Maximum loan-to-value (LTV) ratio: 95 percent of the home’s market value depending on credit, loan amount, and lien position
  • Maximum debt-to-income ratio: 43 percent

That relatively low credit score and high LTV may make Discover a good bet for some who might not get approved by other lenders.

How much?

Discover says of its HELs: “The APR will be between 4.99 percent and 8.99 percent for a loan in first lien position and between 4.99 percent and 11.99 percent for a loan in second lien position.”

Most HELs occupy second lien positions, which just means they sit alongside a first mortgage. However, if you have paid off your first mortgage or never had one, your HEL will likely be a first lien one and you may get a better rate.

Discover customers have zero application and origination fees and there is zero cash due at closing.

Application experience

According to the company, “In order to reduce costs to the customer, Discover Home Equity Loans provides customer service online and over the phone instead of using local branches. Each applicant receives dedicated service from a Personal Banker. The Personal Banker team is available Monday-Friday 8:00 a.m. – 10:00 p.m. eastern time.

Applicants also enjoy the benefit of advanced online tools, allowing them to get pre-qualified online, keep track of their loan status, check their to-do list and upload documents. The closing process takes about 45 minutes, in which a notary will meet the customer at a convenient location where they will sign their loan documents.”

The Navy Federal Credit Union started out in 1933 with seven members. Today, it has over 8 million.

It says that, since its founding, “our mission has remained the same: to serve and enrich the lives of those in the military community. Once you’ve joined, you can remain a member for life, even after you leave military service.

Better Business Bureau rating: A (not an accredited business)

Navy Federal gets an “A” BBB rating because of government action against the credit union. It has fewer customer complaints on the BBB website than many other lenders its size.

Loans on offer

You’ll need to be a Navy Federal member to take advantage of its home equity offerings. But membership is open to all currently serving in any of the services and all veterans, plus some other groups. You’re also eligible if you’re a close family member of someone who’s eligible, and that includes grandparents, parents, spouses, siblings, grandchildren, children (including adopted and stepchildren) and household members.

The credit union offers both HELs and HELOCs. Terms for fixed-rate home equity loans range from 5-20 years.  For the home equity line of credit, the draw period is 20 years and then, members have an additional 20 years to repay the amount owed.

That HELOC term is exceptionally long. Many competitors offer a 10-year draw period, followed by a 5-year repayment period.

Will you qualify?

A Navy Federal spokesperson explained its attitude to credit scores, “We work closely with our members to find the right equity or line of credit for their needs. We do ‘true underwriting’ — our members aren’t determined by just one number but by several factors.” And the situation’s similar for debt-to-income ratios: “We do not have a hard ‘cut off’ for DTI.  We look at the member’s entire situation.”

When it comes to loan-to-value ratios, the credit union is more generous than most. You can get up to 100 percent of your home’s market value for a fixed-rate home equity loan and up to 95 percent on HELOCs. When calculating the amount available to you, remember the “loan” in loan to value includes all your borrowing that’s secured on your home: your first mortgage and new and existing second mortgages, if any.

How much?

At the time of writing, interest rates start at  5.750 percent for the 5-Year fixed-rate HEL and 5.5 percent for HELOCs. How much you actually pay will be determined by many factors, including your credit score and DTI and LTV ratios.

Navy Federal promises low closing costs, with no origination or prepayment fees.

Application experience

Navy Federal has 319 branches, which means some consumers won’t find one nearby.  It has an online application process but you need to be a member to access that.

However,  you can call a number to be connected with a loan processor, who should help you select the most appropriate HEL or HELOC and start off your application.

PNC home equity loan

PNC is one of the largest banks in the United States based on deposits and branches. It has assets of $380 billion, 53,000 employees and 2,400 branches.
It operates in 19 states, plus the District of Columbia, primarily focused in the Middle Atlantic, Southeast and Midwest.
Better Business Bureau rating: A- (not an accredited business)
BBB notes that this slightly less than perfect rating is a result of “Failure to respond to 1 complaint(s) filed against business.”

Loans on offer

PNC offers both HELs and HELOCs in the states in which it has a presence. The former comes with fixed rates. HELOCs generally have variable rates although it is possible to lock the rate on some or all of your balance.

Loan terms may vary by state. HELs generally have a maximum term of 30 years. And the standard HELOC has a 10-year draw period, followed by a (very long, by industry standards) 30-year repayment period.  However, in Tennessee, that repayment period is 20 years.

The banks say, “PNC HELOCs offer a customer the flexibility to access their funds through online transfers, convenience checks and Visa Access cards, providing choice in how to access their lines of credit.  PNC’s Home Equity Installment Loan is a great alternative to a conventional mortgage refinance for customers looking to refinance their mortgage and get cash out with low closing costs.”

Will you qualify?

In common with many other lenders, PNC does not reveal its thresholds for credit scores and debt-to-income ratios. It would probably say that it views each application individually.

It does disclose its maximum loan-to-value ratio, which is 89.9 percent.

How much?

PNC does not charge application fees on any home equity products. If you live in Georgia, expect to pay a $10 Residential Mortgage Act fee.

You may get a 0.25 percent interest rate discount by providing your monthly payment is automatically deducted from your PNC checking account.

For HELOCs at $250,000 or less, there are no closing costs. However, depending on your state, you may have to pay property search fees that vary between $12 and $250. There is a $50 annual fee, although that may be waived if you have one of the bank’s Performance Select checking accounts.

HELs do require some closing costs, including recording and satisfaction fees as well as the same property search fees. All these vary from state to state. All will be revealed in response to your application.

The bank does not appear to publish interest rate guides. It notes that rates may vary by market.

Application experience

It takes 10-15 minutes to complete the online application process. If you find you don’t have all the information you need, you can save your application and revisit it later.  And, if you require help, you can contact the call center.

If you prefer, you can visit your local branch for a face-to-face meeting with a representative.

SunTrust home equity loan

This bank serves 4.4 million consumer households and employs more than 23,000 people, many in its 1,222-strong branch network.

SunTrust is the 2018 JD Power award winner for Best Home Equity Lending Solution. That by itself might be sufficient to secure its inclusion in this list of best banks for home equity loans in 2019. But there are other reasons.

Better Business Bureau rating: A+ (accredited business)

Loans on offer

SunTrust offers only home equity lines of credit, not home equity loans. Its standard HELOC provides a 10-year draw period, followed by a 20-year amortization (repayment) period. There are both variable rate and fixed-rate draw options.

Loan amounts range from $10,000 to $500,000.

Will you qualify?

The bank does not disclose its thresholds for credit scores and debt-to-income ratios. Instead, it says, “We work with our clients to provide the right solution to meet their needs.”

It does reveal its maximum loan-to-value ratio, which is 89.9 percent of your home’s market value. Remember, that percentage includes all borrowing that’s secured on your home, including any existing first and second mortgages.

How much?

The rate you’re offered will depend on many factors, including your creditworthiness and where you live. SunTrust promises, “No closing costs, as long as your account is open for 3 years.”

At the time of writing, the bank is offering a low introductory rate of 3.99 percent APR for the first 12 months of your loan. That’s only available on initial advances of $25,000 or more taken at closing under the variable rate option.

After the introductory offer expires, rates will revert to standard. These currently start at 5.00 percent to 6.22 percent APR, depending on where you live.

All the above rates assume you’re getting a 0.25 percent discount, which is available to those who pay down their HELOCs from a SunTrust checking, savings or money market account using SurePay.

Application experience

You can apply online (there’s a mobile option), in a branch or over the phone in, according to the bank, less than 15 minutes. A SunTrust representative should contact you within 24 hours to explore your options and let you know what documents will be required.

TD Bank home equity loan

TD Bank is one of America’s 10 biggest banks and has a history spanning 150 years. Today, it has 9 million customers, 27,000 employees and 1,250 branches across the Northeast, Mid-Atlantic, Metro D.C., the Carolinas and Florida.

Better Business Bureau Rating: A+ (accredited business)

Loans on offer

The bank offers both home equity loans and home equity lines of credit. Rates, terms and conditions may vary, depending on where you live. So you should check TD Bank’s website, telling it your state and county, to make sure all the information provided below applies in your area.

HELs typically come with fixed rates and terms ranging from five to 30 years. HELOCs have variable rates as standard but there is an option that lets you fix a rate for all or part of your balance.

Will you qualify?

TD Bank is not forthcoming about its lending criteria.

In theory, the bank’s maximum loan-to-value ratio is 89.9 percent of the home’s market value for both HELs and HELOCs. However, when we gave the website a zip code (12205), it said the maximum LTV for both was 80 percent. So expect your location to be a factor in your loan amount.

How much?

Just like LTVs, interest rates may vary depending on where you live — as well as on other factors. On the day we visited the site, the best deal on HELOCs was 4.99 percent on lines of credit greater than $200,000. The rate increased as lines got smaller: up to 7.24 percent on lines in the $25,000-$50,000 range.

There are no closing costs on lines under $500,000. However, there’s a $99 origination fee on all loans and a $50 annual fee on most.

The best deal on HELs was 5.39 percent APR, based on a $100,000 loan amount with a 120-month term and an 80 percent LTV.

All the above rates assume you’re getting a 0.25 percent discount. You’ll be eligible for this if you pay down your loan/HELOC using the automatic payment deduction service from a TD Bank personal checking or savings account.

Application experience

For a HELOC, you can apply online, by phone or in person in a branch. For a HEL, the bank provides only the last two options. You can use the website to schedule a call.

U.S. Bank home equity loan

U.S. Bank can trace its roots back to 1863. Today, it is America’s fifth-largest bank and has 73,000 employees. At the end of 2017, it had assets of $462 billion.

Better Business Bureau rating: B+ (accredited business)

The bank gets only a B+ from the BBB because it has faced government action.

Loans on offer

U.S. Bank offers both fixed-rate HELs and variable rate HELOCs. However, that HELOC offering gives you the option of fixing the rate on some or all of your balance.

Home equity loans can have terms of up to 30 years. The standard draw period for a line of credit is 10 years.

Will you qualify?

In common with many other lenders, the bank does not disclose its credit score threshold, nor its maximum debt-to-income and loan-to-value ratios.

However, its website suggests that its very best interest rates are available only to those with a loan-to-value ratio below 70 percent. And, for HELOCs, you might need a credit score as high as 730 to qualify for those ultra-low rates.

Don’t panic! Approval thresholds are likely to be much easier than those for the best rates.

How much?

U.S. Bank explains, “Rates will vary based on the market and other aspects of the account, including loan to value, loan amount/line of credit, customers’ credit score and presence of a U.S. Bank checking account.”

On the day we visited the bank’s website, rates for HELOCs ranged from 4.95 percent APR to 8.35 percent APR. For HELs, the lowest rates were 5.49 percent APR for a 10-year term and 5.74 percent APR for a 15-year one. Expect to pay more for a 30-year loan.

The website says, “There are no closing costs on home equity lines or loans, though loan accounts may have an origination fee if elected by the borrower.”

Application experience

Customers are able to meet with a banker face to face in a branch or complete an application online if they choose.  The bank also provides customers with the added flexibility to schedule an appointment online so they can discuss their options with a banker at a time that is convenient for them at the branch of their choice.

Wells Fargo home equity loan

Is any American bank more iconic than Wells Fargo? Its 160+-year history is full of the romance of the Wild West. Today, it has 8,050  branches, 265,000 employees and $1.9 trillion in assets.

Better Business Bureau rating: No rating (not an accredited business)

Wells Fargo has had some widely reported issues in recent years. BBB says its No-Rating status exists because “The business is in the process of responding to previously closed complaints.”

However, the bank still deserves inclusion in our list of the best banks for home equity loans. It has quality products and a good application experience.

Loans on offer

Wells Fargo offers only home equity lines of credit. Home equity loans are not available.

HELOCs have a draw period of 10 years and one month. After that, you get a 20-year repayment period during which you must zero your balance.

The minimum credit line is $25,000 and in most cases, the maximum is $500,000.

Will you qualify?

The bank says it does not disclose its minimum credit score nor its maximum debt-to-income ratio. However, its website provides some hints. It says of those with scores in the 621-699 range: “You may have more difficulty [than those with higher scores] obtaining credit, and will likely pay higher rates for it.”

For DTI, it suggests, “Calculate how much you pay each month on your current debts — such as mortgage, credit card, and student loan payments — and make sure the total isn’t more than 43 percent of your monthly pre-tax income.”

Your loan-to-value ratio can be as high as 85 percent of your home’s market value after deducting your new line of credit and any existing borrowing secured on your home. But that’s 80 percent for homestead properties in Texas.

How much?

The bank doesn’t apply fees on application. Closing costs can be paid by either you or Wells Fargo, but you’ll pay a higher interest rate if you choose the latter.

The website doesn’t advertise rates but provides a Rate and Payment Calculator that can give you an approximation of the deal you might be offered.

Application experience

You can apply online, by telephone or at a branch. Given Wells Fargo’s 8,000 locations nationwide, it may be easier to take an in-person application, than it is with most other lenders.

The online application process seems reasonably straightforward.

Comparing home equity loans and HELOCs

The easiest way to get your best deal is to start with our chart of best banks for home equity loans and find a few lenders that provide what you’re looking for. Then contact them for loan quotes, narrow it down to a couple of the most competitive.

Finally, contact them both and then choose the one that is easier to work with. This gets you a great rate and also a satisfactory experience.

Verify your new rate (Oct 22nd, 2019)