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The Best Home Equity Loans

Where Can You Go to Find the Best Home Equity Loans?

Homeownership opens doors to various financial opportunities, one of which is leveraging the equity in your home through loans or lines of credit. Two common options are home equity loans and Home Equity Lines of Credit (HELOCs).

What's the difference? A home equity loan is a lump-sum loan secured by the equity in your home. Fixed interest rates and predictable monthly payments make it a stable option. The borrower receives the entire loan amount upfront, making it suitable for one-time expenses like home renovations or debt consolidation.

Thursday, April 18th

2024 Home Equity Loan Reviews

Top Consumer Reviews Best-In-Class Blue Ribbon Award US Bank Review 5 Star Rating

US Bank

5 Star Rating
  • Home equity loans, HELOCs, and cash-out refinance available
  • Loan estimate available over the phone without an application
  • Can borrow between $15,000 and $750,000 (or up to $1M in California)
  • "A-" rated and accredited by the BBB
  • In business for almost 100 years
Top Consumer Reviews Best-In-Class Blue Ribbon Award

For nearly a century, US Bank has been a stalwart in the financial industry. If you value the security of borrowing from an established institution, this lender is an excellent choice for your home equity borrowing needs.

3 ways to borrow against your home's equity

US Bank makes us want to sigh with relief: not only do they provide all three types of equity loans (home equity, HELOC, and cash-out refinance), they also offer a loan estimate over the phone without completing a full application. No matter how you want to borrow, US Bank has options, and we love that they don't try to get you to give up your information or do a hard pull on your credit just to get an idea of what you might qualify for. Not sure which one is best? Just look for the section that says, "Find the right approach for you" , answer a few questions, and US Bank will make a recommendation.

Preview rates and terms without disclosing your info

You can get a preview of rates and such when you visit the main page of each home equity loan type (just go to where it says "learn more" to, well, learn more). It's still a ballpark, and your rates will obviously depend on your specific situation. But, just as a reference, at the time we checked, we were able to see rates from the week prior to our review, with several examples given. Simply enter your loan amount and desired length, and you'll instantly see competitive rates and monthly payments.

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Transparency abounds

We also appreciate how upfront US Bank is with the terms, conditions, and caveats: no need to get halfway through an application only to find out you're not eligible. You'll find those at the bottom of the website, but here are a few you should know about:

  • HELOC: not every property location will be eligible for the lowest rates; it varies by state. A US Bank personal checking account is required to qualify for the lowest rate, but not to be approved; in some states, borrowers can get the lowest rate without that checking account requirement. You'll pay a 1% early closure fee (for a maximum payment of $500) if you pay off your HELOC and close it within the first 30 months.
  • Home equity loans: automatic repayments drawn from a US Bank personal checking or savings account is a requirement to receive the lowest advertised rate. These loans aren't available for properties held in a trust in HI, LA, NY, OK, and RI. You'll need a FICO score of 660 or higher.

Minimal complaints when you consider the size

You might choke a bit if you look at US Bank's listing on the Better Business Bureau: over 4,300 complaints filed with the BBB over the last three years. But, as a financial institution that's been around for almost 100 years, with more than 11 million customers and 2,200+ branch locations, US Bank is bound to receive some complaints. The bank's "A-" rating and accreditation from the BBB is reassurance that all is well, relatively speaking.

Moves into our #1 spot

Because of US Bank's offering of all three types of home equity borrowing, their transparency throughout the process, and the ability to get a loan estimate without disclosing sensitive personal information, we're pleased to move them up to our first-place ranking among lenders. We encourage you to make US Bank your first stop when looking for a home equity loan.

Discover Review 4.5 Star Rating

Discover

4.5 Star Rating
  • Home equity loan and cash-out refinance available
  • Fees and interest rates clearly displayed
  • Loan amounts available from $35,000 to $300,000
  • No fees for application, origination, appraisal
  • No cash required at closing
  • Terms range from 10 to 30 years

As much more than just a credit card brand, Discover deserves a chance to compete for your home equity loan needs. Their rates are impressively competitive, catching our attention in a crowded market. What sets them apart is the absence of fees - no origination, appraisal, or application fees, and remarkably, zero cash is required at closing. While they may not still claim our top spot, Discover offers an attractive package.

No hidden anything

One of the reasons we still love Discover for home equity borrowing is their transparency. Right on the Home Loan Rates page, you'll see everything you need to know without ever having to provide a single piece of your sensitive data. So, for either their traditional home equity loan or their cash-out mortgage refinance, the terms are almost identical: you can borrow from $35,000 to $300,000 with fixed monthly payments, choose a term of 10-15-20-30 years, and there will be no application, origination, or appraisal fees, and no cash required at closing. While the available interest rates will vary depending on when you're looking at getting a home equity loan, Discover's rates at the time of our evaluation were very competitive with other top lenders' (and definitely well below what you'd pay on most credit cards).

Fees if you pay it off in the first 3 years

However, there's a small catch. If you pay off your loan within the initial 36 months, Discover expects reimbursement for some closing costs, capped at $500. Residents in Connecticut, Minnesota, New York, North Carolina, Oklahoma, or Texas are exempt from this provision. Despite this requirement, Discover's fee structure remains quite appealing.

Check eligibility requirements

Curious about eligibility? Discover requires a credit score of at least 620, verifiable income, a history of responsible credit use, and a debt-to-income ratio below 43%.

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One process for both home equity loan types

The "get started" button will take you to the application process for both types of home equity loans through Discover. You'll enter the usual details, like property information, desired loan amount and purpose, and so on. Unfortunately, in our application, we got a message that Discover was "experiencing some technical difficulties" but that we could still complete our application over the phone.

Try the calculators

If that happens to you, and you'd still like to gather more information in the meanwhile, try out some of Discover's free tools on the Home Loans pages. The ones most useful to you will probably be the Cash Out Refinance Calculator and the Rate & Payment Calculator, to give you an even better ballpark of what your Discover home equity loan or cash-out refi might look like.

Still an excellent choice

With a history spanning over six decades, Discover boasts an "A+" rating and accreditation from the Better Business Bureau. Consistently a top lender, Discover remains a strong contender for your home equity loan, providing a compellingly-transparent fee structure and competitive rates. For these reasons, Discover receives a high recommendation from us in the realm of home equity loans.

LendingTree Review 4 Star Rating

LendingTree

4 Star Rating
  • Home equity loans and HELOCs available
  • Loan marketplace that refers you to multiple lenders
  • Check out lender reviews even before applying
  • Transparent process at every step
  • Funds may be available as soon as next day
  • "A+" rated and accredited by the BBB

If you're exploring options for a home equity loan, you might have come across LendingTree. It operates as a service that connects you with home equity loan offers from a network of over 300 vetted lending partners, offering a comparison "shopping" experience for rates and terms. With over $260 billion in funded loans and more than 110 million American clients, this platform could be a great starting point for your search, potentially introducing you to lenders you might not encounter otherwise.

You'll still have to take a few steps to actually apply

It's important to reiterate that while LendingTree facilitates the matching process, it doesn't directly fund your loan. That means you'll still need to undertake the additional steps of selecting a lender, completing their application process, and similar tasks. While LendingTree streamlines the process by providing access to multiple offers with a single online inquiry, you'll need to plan on taking time to research and understand the specific lender you ultimately choose.

Can get options even without entering your info

So, how does it work? First, you'll indicate what type of property you have: a single-family home, townhome, condominium, manufactured/mobile home, or multi-family home. You'll be asked for further details about how you use the property, the zip code, the purpose of the home equity loan, the value of the property, and so forth. At the very end, LendingTree will attempt to verify your identity and do a soft pull on your credit, either through the details you offered (like your address and phone number) or by having you enter your SSN. You'll still get home equity loan options if you don't (or if you enter a fake profile just to see what LendingTree is all about...), but for the most customized quotes you'll have to enter accurate details.

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Detailed info about many lenders

One of the most compelling reasons to give LendingTree a look is the information they provide on lenders (even some of the competitors you'll find in our review). For example, on one of the lending partners we were matched with, there were over 7,000 reviews from LendingTree clients. Even if you don't use LendingTree to get a home equity loan, you absolutely should look up the lender you're planning to choose and see what others have to say.

Lots to see on your results page

Back to LendingTree's results, though: when you're at the stage of getting a list of lending partners, you can click on "See Details" to find out more about the financial institution, call or email them, or cut to the chase and click on "Apply" . That will take you directly to the lender, to fill out the application for your home equity loan.

LendingTree decides which loans you see

One word of not-quite-warning: because LendingTree makes money by affiliating with lenders, that determines which lenders they present to you and in which order they show up. That doesn't mean this isn't a good way to check out several different options for getting your loan, but LendingTree does have some say-so in what you see. It might not be every possible lender or loan you could find if you looked around a little more.

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Good reputation, but expect spam

LendingTree is trustworthy, demonstrated by its "A+" rating and accreditation from the Better Business Bureau. The service has accumulated numerous five-star reviews from satisfied clients who have successfully used the platform for a wide range of borrowing needs, including home equity loans. Recent testimonials underscore clients' satisfaction with using LendingTree to secure favorable rates, with some praising the platform for helping them get loans with funds disbursed within one business day. Be aware, however, that a subset of complaints centers around the frequency of phone calls, texts, and emails from lenders, a common challenge associated with comparable lender-network services.

Best site for shopping around to find the right home equity loan

Who doesn't want to save time? LendingTree gives you the opportunity to shop around for your home equity loan with just one online inquiry, so if you're in a hurry and you don't want to do the legwork yourself, consider starting your research here. We recommend that you do some double-checking once you've chosen a lending partner, just in case LendingTree's for-profit algorithm skips an option that might also work. But, overall, you can trust that this referral service is going to connect you with multiple ways to get a home equity loan from a vetted financial institution.

PNC Bank Review 4 Star Rating

PNC Bank

4 Star Rating
  • Focuses primarily on HELOCs
  • HELOC available everywhere but Alaska, Hawaii, Louisiana, Mississippi, Nevada, and South Dakota
  • Refinancing available but may not be cash-out
  • Switch at will between fixed and variable rates (for a fee)
  • 0.25% rate discount if you pay from a qualifying PNC checking account
  • "A+" rated by the BBB

PNC Financial Services Group, commonly known as PNC, is a diversified financial services company headquartered in Pittsburgh, Pennsylvania. Established in 1845 as the Pittsburgh Trust and Savings Company, PNC has grown into one of the largest banks in the United States, offering a range of financial services, including banking, asset management, and corporate and institutional banking.

Cash-out refi? Maybe, maybe not

If you're looking to use the equity in your home, PNC will steer you towards their Choice Home Equity Line of Credit, or CHELOC. While this lender does offer mortgage refinancing, they don't go into detail as to whether or not they allow that to be a cash-out situation. (Even when we went to the "learn more" link on refinancing an existing mortgage, the link went nowhere.) You're welcome to call and find out, but since PNC seems to focus heavily on the CHELOC option, we've done the same in our evaluation.

Unique HELOC structure allows for switching back and forth

So, let's jump in and look at what PNC has on offer in that regard, because it's a little different from many of the home equity loan sources on our list. There's a reason why they include "choice" in the name: because you can either lock in a fixed rate or opt for variable rates and payments, and you can switch between the two. Here's how they put it: "You can follow the market and wait for the lowest interest rate. After you draw your funds, you can transfer to a fixed rate part to lock in the fixed rate. You can also go from a fixed rate back to a variable rate." Sounds amazing, right? What's the catch? As you might expect, it's in the fees. You'll pay them every time you make a switch, and unfortunately they don't come out and tell you what those fees are.

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Check out the FAQs

Many of the questions you may have about this type of home equity line of credit are at the bottom of the site. It'll give you what you need to know about LTV maximums in your state, in which states the CHELOC isn't available, and what you can expect from the overall process of applying and getting your funds disbursed.

Preview your rates and loan options

Once you've read through the FAQs at the bottom of the site on your own, we recommend starting with the "Check Rates & Apply" Button at the top of the CHELOC page. That's the quickest route to get to your personalized lending options. Pay attention to which parts are required (like the total line amount) and which are optional (like how much you'd like as an initial withdrawal). We appreciate that prospective clients are given the option to opt out of getting personalized rates; even though we understand that only a soft pull on one's credit history is done, some people prefer to hold off on that step until they're sure that PNC is the lender they want to work with.

Easy to see all of the loan options without providing your info

On the pages that follow, you'll really get down to the nuts and bolts of what PNC's CHELOC could look like for you, even if you opted not to personalize your rates. You'll see that there's a 0.25% rate discount when payments are deducted from a PNC checking account. You can also check out some example rates and terms, like a Variable Rate/Payment line of credit, a series of Fixed Rate/Payment options (with terms of 360 months, 240 months, and so on), or even a customized fixed-rate term tool. Once you see something you like, click on "Apply Now" to take it to the next step with PNC.

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Reputation is positive considering the number of clients

How about PNC's overall reputation? They have an "A+" rating from the Better Business Bureau (hooray), but there were not only 2,700+ complaints filed against PNC over the last three years, but also a rock-bottom average of just 1.11 stars out of 5 for those who opted to leave a review instead of a complaint (boo). Still, when you figure that PNC Financial Services Group has over 10 million customers (from loans to traditional banking and beyond), that's not so extraordinary after all. And, among all of the complaints and negative reviews we looked through, we didn't spot a single mention of PNC's home equity line of credit.

Worth considering for the CHELOC

We're intrigued by the ability to turn on and turn off variable/fixed rates, not seeing that option with any other home equity lender on our list. We're especially appreciative of the calculators and loan previews that let just about anyone get a ballpark idea of what their CHELOC might look like for the amount they want to borrow. While we'd love to see PNC get a bit more specific as to whether or not they offer cash-out refinancing as well, that's no reason not to check them out otherwise. If you already know that a home equity line of credit is your ideal form of borrowing against your property, give PNC a chance.

AmeriSave Review 3.5 Star Rating

AmeriSave

3.5 Star Rating
  • Offers cash-out refinances and HELOCs
  • Maximum amount on HELOC is $249,000
  • Loans come with closing costs and application fees
  • "A+" rated and accredited by the BBB

AmeriSave is no newcomer to the online lending industry. With over 20 years of experience, they've financed over 730,000 borrowers in 49 states, for a total loan volume surpassing $130 billion.

HELOC or cash-out refi

There are two ways to take advantage of your home's equity through AmeriSave: a cash-out refinance or a home equity line of credit (HELOC). The page corresponding to each lending type is straightforward and provides most of the details you would want to know before submitting an application, including calculators to get some parameters for what you'd like to borrow. Here are some of those details:

  • Cash-out refinance: expect closing costs just like a traditional mortgage process. Credit approval can take place in just three minutes, and it takes about 31 days on average to close on your loan. You'll want to use AmeriSave's calculator to determine how much you can borrow, based on your credit score, the value of your home, and your LTV.
  • HELOC: you can borrow up to 80% of your LTV ratio. Expect to pay valuation fees as part of the process of determining what your home is worth. It comes with a 10-year draw period, and monthly payments are interest-only then. During the repayment period (years 11-20), your repayments will go towards both principal and interest. Again, use AmeriSave's helpful calculators to get an idea of what your HELOC's structure could be, but be aware that the fine print discloses that AmeriSave's maximum borrowing amount is $249,000, regardless of how much equity you have in your property.

Loans come with costly fees

Speaking of fine print, we encourage you to scroll all the way down to the bottom of the AmeriSave site to get a heads up on those. For example, on the HELOC page, we found mention of a $195 application fee, an $800 funding fee, and "certain fees to third parties" (such as appraisers, we'd assume) that range from $0 to $2,500. But, those disclosures were listed as current on a date that was more than a year in the past, so you may find they've changed when you're ready to get your loan here. Don't be lazy and skip reading your loan disclosures, no matter where you get a home equity loan or line of credit.

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Complaints are on the decline

AmeriSave's reputation with the Better Business Bureau is interesting. To start, the lender has an "A+" and accreditation, always a good beginning. The pattern of complaints is what caught our attention: over 1,700 complaints filed in the last three years, but only 196 in the last twelve months. To us, that shows that whatever problems they may have been happening three years ago were likely related to greater issues on a national or even global scale, and that AmeriSave has done a fantastic job of resolving them.

Keep an eye on your loan process

Reviewers at Trustpilot would agree, with a 4.3-star average across more than 11,000 ratings. We decided to look just at the reviews that mentioned "HELOC" , though, and found that borrowers weren't quite as universally thrilled with their experience. One person said that the application process dragged on for over a month, while another complained that communication on their HELOC tanked after they paid a $195 underwriting fee. We're glad to report that AmeriSave responded to all complaints (on both the BBB and Trustpilot), but it did give us a bit of pause with respect to the procedure for home equity lending there.

Solid overall choice for HELOCs and cash-out refi

AmeriSave earns a respectable 3.5-star rating from us. They earn high marks for overall loan volume and reputation, but lose a few for not being quite as competitive as other home equity loan options on our list. That applies to the fees they charge, the amount that clients can borrow, and yes, some of the complaints we found regarding HELOCs here. AmeriSave isn't necessarily the first place we'd turn (as you would conclude from its ranking on our list), but it's not a bad option either.

loanDepot Review 3.5 Star Rating

loanDepot

3.5 Star Rating
  • Refinance or HELOC available
  • Can take up to two weeks to receive funds
  • Funded more than $275 billion in loans since 2010
  • "A+" rated and accredited by the BBB

loanDepot, founded in 2010 by entrepreneur Anthony Hsieh, has rapidly become a prominent player in the mortgage and lending industry. Initially established as an online mortgage marketplace, the company quickly evolved into a direct lender, offering a variety of mortgage and home loan products. The company's commitment to innovation, coupled with a robust online platform, has contributed to its status as one of the leading non-bank lenders in the United States.

Choose between cash-out refi and HELOC

There are two main lending products available through loanDepot if you want to take advantage of your home's equity: a cash-out refinance or a HELOC. Here's what to know about each kind:

  • HELOC: not available in all states (you'll have to contact loanDepot for details, or start the process and see if you qualify). This is a traditionally-structured line of credit, with credit line amounts between $35,000 and $250,000 if not dictated otherwise by state law. You'll pay an origination fee of 5% of the line amount (or the maximum allowed in your state, whichever is less). loanDepot HELOCs have a 30-year term, a 3-year draw period, a 10-year interest-only period, and a 20-year repayment period. Your specific offer, with rates and fees, will depend on your income, credit line amount, credit score, and so on.
  • Refinance: loanDepot doesn't specifically market their refinancing options as a "cash-out" service, so it's hard to tell if they allow that through the traditional refinancing channel. When we filled out the form for refinancing, we got this message (complete with grammar mistakes): "Thank you for filling the form. One of our expert will contact you soon." And also on that page, it offers to let visitors view legal disclosures and important notices by clicking on "the following" link... but there's nothing there.

Apply online, but notarize in person

While you can complete your loanDepot application digitally, there is no remote online notarization process offered here. That means you'll still have to visit a notary in person to finalize your paperwork.

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Good feedback from the BBB and elsewhere

We don't discount the company's overall excellent reputation, exemplified by its "A+" rating and accreditation from the Better Business Bureau, along with an average of 4.16 out of 5 stars across 3,700 ratings on the BBB site itself, and a lower but still respectable 3.7 stars out of 5 on Trustpilot. (We even saw reviews from as recently as a few days prior to our review that mentioned being thrilled with a cash-out refi, so there's the confirmation that such a home equity loan type is indeed possible with loanDepot.)

Not for the impatient

Despite loanDepot's status as a popular online lending service, we were put off by the number of glitches we encountered during the process. We came away feeling annoyed, to be honest, by the poor grammar and the "hurry up and wait" feel of not being taken directly to a dashboard, sample rates, or some kind of inkling as to what we might be in for when borrowing through loanDepot (beyond the fine print at the bottom of the site).

Good if you can wade through the rough parts

We'll give loanDepot the benefit of the doubt: their BBB reputation and track record in other places is solid enough to demonstrate that this is no fly-by-night service for home equity loans. But are there places where loanDepot could up its game a little? Absolutely. We're optimistic that customers with more patience than our experts will still have a good overall experience with loanDepot.

SoFi Review 3 Star Rating

SoFi

3 Star Rating
  • HELOC or cash-out refinance available
  • Access up to $500,000 (up to 90%) of your home's equity (HELOC)
  • Available in all states except AK, HI, ID, MA, MO, ND, NV, NY, SD, WV, WY, and UT
  • "A+" rated by the BBB
  • Thousands of five-star ratings

SoFi strives to empower individuals like you in making informed financial decisions, boasting a community of over two million members and $50 billion in funded loans. Beyond home equity-related loans, SoFi offers an array of supplementary products and tools designed to help you strategically pay off debt, build financial security, invest, save for the future, and more. Leveraging these resources can guide you toward a firm financial footing.

HELOC and cash-out refi available, home equity loans only via partner

SoFi offers two ways to leverage the equity in your home: a HELOC or a cash-out refinance (but no traditional home equity loans, unless they pass you along to Spring HQ, SoFi's lending partner). Because most clients searching for a home equity loan aren't necessarily wanting a refi (especially if they got in on those great interest rates several years ago), we'll focus our feedback strictly on SoFi's HELOC product.

HELOCs not available in all states

So, what do you need to know about borrowing against your home's equity here? First, SoFI lets you access up to 90% of that equity, for a maximum of $500,000. It's structured like most HELOCs: borrow what you need, when you need it. Another key point: SoFi doesn't offer these loans in all states. There are 12 states on the exclusion list, which are Alaska, Hawaii, Idaho, Massachusetts, Missouri, North Dakota, Nevada, New York, South Dakota, West Virginia, Wyoming, and Utah.

Asks for a lot of information in advance

To find out what the terms of your HELOC would be through SoFi, you'll answer the usual questions: address, property value, current mortgage balance, desired line of credit amount, and so on. You'll reach a step that says a mortgage loan officer will reach out to you, but you'll be allowed to continue filling out the application. You'll have to enter your social security number and date of birth; no rates are shown without it. It made us uncomfortable to not have even a ballpark interest rate prior to completing the application, or having to wait for a SoFi rep to reach out to give us an idea. It left us feeling like that "soft pull" on our credit could potentially be a "hard pull" without us realizing we had gotten to that stage.

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Might save you money, might not

And since they don't disclose any "rates starting at" information on their HELOC page, SoFi doesn't make it easy to know what you're getting into ahead of time. Considering that they say that you could save money compared to a high-interest credit card or unsecured installment loan, we feel like they're setting that bar a little lower than we'd like and that it would be better to offer greater disclosure prior to the application process.

Strong reputation overall

In general, though, SoFi boasts a solid reputation, evident through its "A+" rating from the Better Business Bureau and an impressive 7,000-plus five-star ratings on Trustpilot. Users who opt for SoFi loans generally express satisfaction with the borrowing limits, the speed of fund availability, and the transparent process. However, we recognize that SoFi's track record is not flawless. As we evaluated SoFi, we found over 700 complaints in the most recent 12-month period, totaling more than 1,300 in three years. But, these issues were predominantly linked to glitches with SoFi's banking products, such as difficulties accessing funds from remotely deposited checks, rather than problems specifically with HELOCs.

Good but not our favorite

All of this adds up to a "just average" rating for SoFi. We appreciate that they have options for multiple kinds of home equity-based borrowing, and that by and large their clients are satisfied with the experience here. However, SoFi could do a lot more to pull back the curtain, so to speak, and let prospective borrowers know more about what to expect. It feels like a bit of a personal data grab to require so much information upfront from the client without disclosing much in return. SoFi isn't a terrible option for a HELOC or cash-out refinance (or as a bridge to a home equity loan, if you're willing to chase that down through SoFi's partner), but we'd suggest looking at the higher-ranked options on our list first.

Rocket Mortgage Review 2.5 Star Rating

Rocket Mortgage

2.5 Star Rating
  • Home equity and cash-out refinance loans available
  • "A+" rated and accredited by the BBB
  • In business since 1985

As America's largest mortgage lender, Rocket Mortgage is on a mission to make it easier for the average person to get the money they need: to buy a home, to refinance their current mortgage under different terms, or to take advantage of their home's equity to accomplish other goals. The company has been in business since 1985, originally known as Quicken Loans and rebranded as Rocket Mortgage in 2021.

Cash-out refi is possible

If you'd like to refinance your home to take cash out, Rocket Mortgage allows you to do that. But, if you have an excellent interest rate on your mortgage from back in the day, you may not want to make that kind of a change just to get some cash from your equity. Fortunately, Rocket also offers home equity loans. Just be aware that they aren't offered on investment properties.

Can't complete home equity loan application online

To get started, you'll choose whether your residence is a single-family, multi-family, condo, or manufactured home, enter how much your home is worth and the amount you'd like to borrow, and several other questions that are similar to most other home equity lender sites. Unfortunately, you can't finish the process online with Rocket Mortgage: you'll have to either wait for one of their Home Loan Experts to reach out to you or call them at their toll-free number during regular business hours. That's a drawback compared with rival lenders who let you take care of the entire home equity loan process online, or who at least give you a ballpark estimate of how much you could borrow and under what terms.

Not enough upfront information on home equity loans

That leaves us with not nearly enough to say about Rocket Mortgage. Unlike Rocket's other loan types (mortgages, personal loans), there's no disclosure of their rates or terms in advance. We're not sure why they leave home equity loans out of their presentation of upfront information. There are calculators for getting an idea of what you could afford with a cash-out refinance, what going rates might be for a personal loan used to pay off high credit card debt, but nothing even remotely telling you how much you could borrow and under what terms.

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Reputation isn't a problem in general

We're not worried that there's anything suspicious going on here. Rocket Mortgage has an "A+" rating and accreditation from the Better Business Bureau; the 1,000 complaints filed there over the last three-year period are more of an indicator of the size of the company rather than any issues with trustworthiness in the lending arena.

Live chat is a bust

But still, we had to turn to Rocket Mortgage's live chat just to ask for basic information, and even that wasn't helpful. To start, the bot referred to it as a HELOC; never mind that it was the only reference to that loan product we saw on the Rocket site. When we tried to ask more, the rep we got in Client Relations said we'd have to reach out via phone to their mortgage bankers because they couldn't answer our questions... even though we were literally using the chat on the Rocket Mortgage website.

Not worth your time

All in all, that makes us feel like the home equity loans offered through Rocket Mortgage are more of an afterthought: "Oh, hey, we offer home loans... I guess we should offer this other type of loan as well..." It's definitely not the smooth, all-online process we've found with most of the lenders on our list. Until and unless Rocket takes steps to be much more transparent about their home equity loan process, we'll have to keep them at a "just below average" rating here.

Figure Review 2.5 Star Rating

Figure

2.5 Star Rating
  • Only HELOC available, structured as a lump-sum initial payment with additional draws available
  • 100% online application takes just 5 minutes
  • Funding can be as quick as 5 days
  • One-time origination fee
  • Minimum loan is $20,000 ($25,001 in Alaska)
  • Maximum loan is $400,000
  • Minimum draw of $500 on subsequent amounts
  • Loans available in 44 states plus DC

Figure is one of the newest players in the lending marketplace, "radically transforming financial services through blockchain technology" . More than 85,000 households throughout the US have benefitted from Figure loans, with over $8 billion in equity "unlocked" for their clients.

HELOC but with full disbursement at the start

When you start browsing Figure to determine what kind of home equity loans they offer, it initially sounds like the traditional variety. It was only when we went to the live chat that we understood what the lender provides: a line of credit secured by the equity in your home (in other words, a HELOC). But, the structure is something of a hybrid: it's a fixed-rate line with a set term and is fully disbursed at the time of funding, which means they give you the full amount of your line of credit upfront.

Additional draws at different rates

Figure's "hybrid" HELOC also includes the option for additional draws over time (but the interest rate on those future draws may not be the same as your initial rate at the time of your loan's funding). That's a good explanation of how they are a little different from the traditional HELOCs. They offer the full amount upfront, and then you start to pay back that amount. As you pay down your line balance, you will be able to redraw up to 100% of your credit limit. Additional draws must be at least $500, and the total outstanding balance cannot exceed 100% of the credit limit.

Borrow up to $400,000

Figure has a minimum loan requirement of $20,000 (or $25,001 if the property is in Alaska). In any state where Figure operates, the maximum HELOC amount is $400,000. Expect a one-time origination fee on your Figure loan; the exact amount will be disclosed in your loan's terms and conditions.

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You'll become a credit union member

We encourage you to read the FAQ specific to Home Equity Lines on the Figure site. That's where you'll be able to get more details on the three credit unions Figure partners with to fund their loans. It's important to understand that taking out a HELOC here comes with a requirement to be a member of one of those credit unions, though the membership aspect is built into your loan itself.

Operates in 44 states

Also be aware that Figure is not available in all 50 states. They list which states they do serve rather than the ones they don't; you'll find that list at the bottom of the Figure site, or you can start the process and see if you qualify based on the address information you enter. (New York is probably the most noticeable exception.)

Lightning-fast online application and funding

On a positive note, Figure can get your HELOC done 100% online: even the required notarization can be done with an eNotary (or you can take it somewhere local if you prefer). Because so much of the process is digital, your application can be completed in minutes, and Figure can often get loan proceeds deposited within 5 days.

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Not rated with the BBB

Figure's reputation really has us scratching our heads. To start, at the time of this review, the Better Business Bureau had the company listed as "Not Rated" , citing the reason as "the business is in the process of responding to previously closed complaints" . That's usually not a good sign. However it's worth mentioning that we could only see seven total complaints filed there over the last three years.

Complaints about loans are concerning

Jumping over to Trustpilot, we were initially excited to see nearly 2,000 five-star reviews, averaging 4.2 stars overall. However, when we sorted those ratings to look at the most recent comments first, we found a few compliments and a lot of complaints. Most of the praise came from borrowers who had just barely gotten their HELOCs funded; the rants were almost always from clients who had issues with their Figure loans down the road. Some of those complaints included discovering a lien on a property when the loan had been paid off two years prior, paying $2,300 in fees for a line of credit that was never used, and inexplicably delayed funding even after loans had been approved.

We recommend getting your home equity loan somewhere else

Because Figure has only one type of home equity loan product (HELOC, not home equity loans or cash-out refinancing), we can't rank them as highly as most of the other options on our list. Our ranking for this lender is also impacted by the negative feedback from clients, the lack of nationwide availability, and the "NR" status with the Better Business Bureau. We recommend that you look at other options before submitting a rate quote request on the Figure website.

Quicken Loans  Review 2 Star Rating

Quicken Loans

2 Star Rating
  • Will refer you to other lending partners
  • Part of the Rocket Mortgage family

Quicken Loans offers a confusing experience if you're looking for a traditional home equity loan. Quicken Loans underwent a rebranding in 2021 and is now officially known as Rocket Mortgage. The rebranding reflects the company's emphasis on its digital mortgage experience and commitment to simplifying the mortgage application and approval process for consumers. And yet, when you visit the Quicken Loans site, you won't initially see anything that shows you what's really "under the hood" so to speak.

Loan types aren't clearly explained

Before you get too far down the track, you should be aware that Quicken Loans seems to only offer one type of home equity lending: cash-out refinancing. That's even more limited than its parent company, Rocket Mortgage (who you'll find reviewed separately in greater detail). You won't get that information conveyed very clearly when you land on the page that says, "Tap into your home's equity with a lender online."

Ready for the hand-off?

So, you'll start to answer the usual questions about whether or not you're a homeowner (strange to ask that when it's literally a home equity-focused landing page), what you're looking to do (in this case, it's taking cash out), the type of home, and so on. You're going to be asked to provide contact information, but the teeny-tiny print at the bottom of the "See Results" informs you that you're consenting to be matched with and contacted by "up to 5 participants in the LMB Provider Network about mortgage and financial services products." Wait a sec. At this point, Quicken Loans is passing you on without even telling you what kind of home equity loan they're teeing you up for.

Pay attention to how you answer

If you click through to see your results, the type of loan and lender you're matched with will depend on how you answered one question during the process: "Do you want to take [cash amount] out of your mortgage?" (or something similarly worded). When we entered "no" , thinking it would disqualify us from progressing further, we were given a different set of matches and results than when we had selected "yes" on another run through the Quicken Loans site.

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You'll wind up with Rocket most of the time

On our "no" results page, the primary match was (surprise surprise) Rocket Mortgage. We were also given referrals to two other home equity lending partners, one of whom is also reviewed on our list. And, all of that was still without telling us exactly what type of home equity loan those partners might be offering us.

You'll always wind up with a different lender

Because Quicken Loans will, 100% of the time, either funnel you to Rocket Mortgage or to a different lender, there's no point in looking for customer reviews or even a BBB rating (since it's just the one shared by Rocket anyway). It feels like this rebranding has Quicken Loans trying to be everything to everyone (not just a direct lead to Rocket Mortgages but also a lending referral platform), and it comes out being not much of anything to anyone.

One word: Fail

For all of these reasons, we can't recommend Quicken Loans for any type of home equity borrowing. If you want a one-stop shop for browsing offers from multiple financial institutions, there's at least one option much higher on our list that gets that job done quite well. Otherwise, we'd recommend not wasting your time now (and down the road as you get all of the unwanted texts, calls, and emails after submitting your info) by even trying Quicken Loans. Just go right to the higher-ranking home equity lenders in our evaluation instead.

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Continued from above...

On the other hand, HELOCs are revolving lines of credit based on the equity in your home. Variable interest rates and flexible withdrawal options make HELOCs adaptable to ongoing or unpredictable expenses. Borrowers can access funds as needed, up to a predefined credit limit, and only pay interest on the amount used.

A third option is a cash-out refinance. In this case, you replace your existing mortgage with a new one that has a higher loan amount. The difference between your current mortgage amount and the new one is taken out as cash that you can use for any purpose you like. Just keep in mind that you may be giving up a lower interest rate on your original mortgage, and you're going to be resetting the clock on when your home will be paid off.

Many of the lenders on our list offer both home equity loans and HELOCs, so feel free to use our information as a starting point for either loan type. And, some lenders we evaluated offer equity-based loans that are a hybrid between the two, with a lump sum distribution but the ability to make future "draws" from the original amount after you've paid back the principal.

Tempted to go to your current lender to see what you qualify for? It's not a bad idea, but we would advise you to resist the urge to jump in and commit. The rise of online lending platforms has added a new dimension to the borrowing landscape, which could get you a much lower interest rate than what your present financial institution will offer.

In the world of home equity loans, the decision-making process becomes even more crucial when interest rates are less than favorable. Whether you're considering a cash-out refinance or a standalone second loan or line of credit, factors such as equity, current mortgage terms, and credit score play a significant role.

So, how can you choose where to start the process? Use these criteria as a yardstick to measure your options:

  • Interest rates. Compare interest rates offered by different lenders to find the most competitive option. Consider whether fixed or variable rates better suit your financial preferences.
  • Fees and closing costs. Assess the fees and closing costs associated with each lender to understand the total cost of the loan.
  • Loan terms and flexibility. Evaluate the terms and flexibility of the loan, including repayment periods and options for early repayment without penalties.
  • Customer support. Consider the quality of customer service and support offered by each lender. Responsive and accessible customer service can be crucial throughout the loan process. Reading through client reviews and ratings is a great way to see how well the lender's representatives are doing at managing clients' needs and concerns.

Whether economic times are a boom or a bust, there's a home equity loan out there that's right for you. The experts at Top Consumer Reviews have carefully evaluated the best of today's top lenders, to help you get the money you need with loan terms that you can afford.

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Home Equity Loan FAQ

A home equity loan is basically a second mortgage. You borrow against the amount of money you have already paid into your residence (as opposed to how much is still owed to the mortgage lender, if any). For example, if you purchased your home for $300,000 and you still owe $200,000, you have $100,000 in equity. Your loan would be based on that $100,000 you have already paid off on your home. (This also assumes that your house is still worth the $300,000 you paid at the time of purchase.)
A home equity loan usually has a fixed interest rate and monthly payment, and you get the entire amount of the loan upfront as a lump sum. A HELOC, or home equity line of credit, lets you take out money as needed up to a predetermined credit limit. However, HELOCs almost always have variable interest rates, so you could be paying more in interest depending on when you withdraw the funds.
You'll likely get lower interest rates with a home equity loan compared with a personal loan - because you're essentially taking out a loan from money you've already paid into your home. Credit card interest rates are not only extremely high, but your credit limit might also prevent you from getting as much money as you need.
Most lenders require you to have at least 15-20% equity in your home. In other words, if your home is worth $400,000, you need to owe less than $320,000 to $340,000 in order to qualify for a home equity loan. Keep in mind that these calculations are based on the current appraised value of your property, not the purchase price.
It's possible that you could face foreclosure if you don't repay your home equity loan. If you're having trouble making payments, it's a good idea to reach out to the lender and ask for a payment arrangement. Being proactive can make a huge difference and may save you from foreclosure.
That depends on the loan terms. Some home equity loans have no prepayment penalty, while others assess early termination fees: usually a percentage of the remaining balance or a certain number of months of interest. If you think there's any possibility that you'll pay off your balance before the end of the loan term, be sure to choose a lender that offers home equity loans without prepayment penalties.
This is another case of "it depends" . First, tax laws can change from year to year, impacting whether or not you can deduct the interest paid on your home equity loan. In the past, the IRS has only allowed deductions when the home equity funds are used to "buy, build, or substantially improve" the home that secured the loan. Check with your tax professional for more information.
Yes. As long as you choose a reputable lender, there's no reason you can't safely and quickly apply for your home equity loan online. It can definitely save you some time and hassle, since there's no need to go into a brick-and-mortar location to fill out paperwork.
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