What do falling interest rates mean for home equity borrowers?

Falling interest rates can make accessing home equity easier and more affordable.

Home equity is the amount of your home you own outright. You can figure out how much home equity you have by subtracting your remaining mortgage balance from your current home’s value. Homeowners looking to tap into their home equity through a HELOC or home equity loan can take advantage of falling interest rates.

Discover HELOC options to begin tapping into your home’s equity as interest rates fall!

Falling interest rates can have a positive effect on homeowners who are already accessing or are looking to access their home’s equity. Here are a few benefits lowering interest rates can have on borrowers.

Interest rates falling means that the cost to borrow money could be lower for anyone looking to tap into their home’s equity.

With any loan you get, whether it is first or second mortgage, you will have to pay interest on the amount you borrow. This interest is a percentage based on your total loan amount. You will make these interest payments monthly. If interest rates have fallen when you get your mortgage, you could pay less each month.

Refinancing your HELOC, current mortgage or home equity loan could end up saving you money over the life of your loan*.

A refinance on your loan will change the terms and match current rates. If interest rates have fallen since you originally got your mortgage, a refinance will match the new lower rates, which would mean you’d pay less toward interest over the remainder of your loan.

Refinances could come with closing costs you will need to cover. To make sure you are getting the most out of your potential lower interest savings, check out the amount of your closing costs to see if the money you could save during a refinance will be more than your closing costs.

With the potential for paying less each month that lower interest rates offer, it allows borrowers to put the money they save toward the principal of their mortgage. This could make monthly payments on your loan more affordable or help you qualify for monthly payments you might not have been able to qualify for otherwise.

Lower interest rates mean that you could spend less when tapping into your home’s equity. If you are using the funds you receive for home improvements, spending less could mean a greater return on investment (ROI) for any renovations you are planning.

Home renovation ROIs can vary depending on the project. Some home renovations can increase your home’s value while greatly improving the livability of your house. Spending less on renovations can increase ROI. If you decide to use a home equity loan or HELOC to fund any planned renovations, lower interest rates would mean spending less money to pay them back, increasing the project’s ROI.

You can start the home equity line of credit process and take advantage of falling interest rates by filling out an application online today.

Online applications will look at your credit history, assets and current mortgage to assess how much you could borrow and what your monthly payments might look like. Online HELOC applications can be completed in as little as five minutes and can get you your funds as soon as five days**.

It is hard to predict where rates are going, so the smart choice is accessing your home equity while rates are low. And if home equity loan and HELOC interest rates continue to drop, you can always refinance to match lower rates.

Take advantage of lower interest rates when tapping into your home’s equity when discovering HELOCs options today!

_{Applicant subject to credit and underwriting approval. Restrictions apply.}

_{Information provided is for educational purposes only. It should not be construed as financial or legal advice or instruction. Rate does not guarantee or assume liability for the accuracy, completeness or timelines of the information. You should conduct additional research before making any mortgage related decisions.}

_{*Savings, if any, vary based on the consumer’s credit profile, interest rate availability, and other factors. Contact Rate for current rates. Restrictions apply.}

_{**Applications may be completed in five minutes but may fluctuate. Five business day funding timeline assumes closing the loan with our remote online notary. Funding timelines may be longer for loans secured by properties located in counties that do not permit recording of e-signatures or that otherwise require an in-person closing. In addition, funding timelines may be longer if we cannot readily verify that your property is in at least average condition with no adverse external factors with a property condition report and may need to order a desktop appraisal to confirm the value of your property. Texas borrowers will have a 12-day cooling period prior to closing on their home equity loan which will begin after the borrower has both filed a loan application and received consumer disclosures.}