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Best HELOC Lenders of 2023

A HELOC lets you tap your home's equity. Compare our selections for best HELOC lenders.

By
Taylor Getler
Mar 1, 2023

Some or all of the mortgage lenders featured on our site are advertising partners of NerdWallet, but this does not influence our evaluations, lender star ratings or the order in which lenders are listed on the page. Our opinions are our own. Here is a list of our partners.

Best HELOC Lenders

Lender
NerdWallet Rating
National / regional
Max LTV
Min. credit score
Learn more
Alliant

Alliant: NMLS#197185

Read review
4.0/5
Best for large withdrawals

National

90%

N/A

Bank of America

Bank of America: NMLS#399802

5.0/5
Best for fixed-rate option

National

85%

660

5.0/5
Best for large withdrawals

National

85%

670

Learn moreat Bethpage Federal Credit Unionat Bethpage Federal Credit Union
Golden 1 Credit Union

Golden 1 Credit Union: NMLS#669333

4.5/5
Best for no annual fees

Regional

N/A

N/A

Guaranteed Rate

Guaranteed Rate: NMLS#2611

4.5/5
Best for large withdrawals

National

85%

640

Homebridge

Homebridge: NMLS#6521

4.0/5
Best for no annual fees

National

N/A

N/A

PenFed

PenFed: NMLS#401822

4.0/5
Best for fixed-rate option

National

85%

N/A

PNC

PNC: NMLS#446303

4.5/5
Best for existing customers

National

85%

680

State Employees' Credit Union

State Employees' Credit Union: NMLS#430055

4.5/5
Best for long draw period

Regional

90%

640

Truist

Truist: NMLS#399803

4.5/5
Best for fixed-rate option

National

80%

N/A

Bethpage Federal Credit Union
Learn moreat Bethpage Federal Credit Unionat Bethpage Federal Credit Union
Bethpage Federal Credit Union

Bethpage Federal Credit Union: NMLS#449104

5.0
National / regional

National

Max LTV

85%

Min. credit score

670

Learn moreat Bethpage Federal Credit Unionat Bethpage Federal Credit Union
Why We Like ItGood for: borrowers seeking a solid selection of mortgages and the membership-based, not-for-profit business model of a credit union.
Pros
  • Offers a fixed-rate option.
  • No annual fees.
  • Offers a fixed introductory rate.
Cons
  • Minimum draw required for best rate.
Guaranteed Rate

Guaranteed Rate: NMLS#2611

4.5
National / regional

National

Min. credit score

640

Max LTV

85%

Why We Like ItBorrowers who want to know exactly what their payments will be can benefit from Guaranteed Rate's fixed-rate option.
Pros
  • CLTV borrowing limit over 80%.
  • Offers a fixed-rate option.
  • Offers paths for rate discounts.
Cons
  • No information about annual fees.
PenFed

PenFed: NMLS#401822

National / regional

National

Max LTV

85%

Min. credit score

N/A

Why We Like ItPenFed is a strong choice for borrowers who want to take advantage of a fixed-rate option from a credit union.
Pros
  • Offers a fixed-rate option.
  • Borrowing limit of 85% CLTV.
Cons
  • Annual fee of $99.
PNC

PNC: NMLS#446303

National / regional

National

Max LTV

85%

Min. credit score

680

Why We Like ItExisting PNC customers can take advantage of discounts on their APR.
Pros
  • Offers a fixed-rate option.
  • Offers a rate discount for existing customers.
Cons
  • Annual fee of $50.
State Employees' Credit Union

State Employees' Credit Union: NMLS#430055

National / regional

Regional

Max LTV

90%

Min. credit score

640

Why We Like ItState Employees' Credit Union may be a strong match for qualified North Carolina borrowers who want a long window to access their equity.
Pros
  • Long draw period of 15 years.
  • Introductory offer is below the prime rate.
Cons
  • Credit union membership is limited by restrictive requirements.

How a HELOC works

A HELOC works similarly to a credit card: You’re able to borrow up to a certain limit as needed, rather than taking out a lump sum all at once. The lender uses your home’s value to set the HELOC limit, and they’ll let you borrow a percentage of what you own. You may borrow during a draw period that lasts for several years and pay interest only on the balance. After the draw period ends, you may no longer take money out, and you pay the principal plus interest.

To obtain the best HELOC rates, make sure you comparison shop, preferably among at least three lenders. By shopping around, you're likely to find the combination of features and interest rate that make the best home equity line of credit for your needs.

» MORE: Understanding home equity lines of credit

Pros and cons of HELOCs

A HELOC's main advantage is that it offers flexibility. During the draw period, the minimum monthly payment covers just the interest on the balance, so you don't have to pay principal if you don't want to.

A HELOC can have a variable interest rate, which means it can go up or down over time. When the interest rate rises, the minimum monthly payment may increase, too. Less commonly, some lenders offer a fixed-rate HELOC option, meaning that you can lock in some or all of the loan balance at a specific APR.

There are two major disadvantages to a HELOC: The interest rate can rise, and you can get in over your head if you're not careful. You may end up borrowing so much that you can't comfortably afford the principal and interest during the repayment period.

HELOCs typically have lower interest rates than credit cards. But defaulting on a HELOC could put your home at risk of foreclosure.

Alternatives to HELOCs

A HELOC is not your only option for tapping your home's equity. If you know exactly how much you need to borrow, you may consider a home equity loan, which you receive as a lump sum and pay back at a fixed rate.

If you need to borrow more money than you'd qualify for with a HELOC or home equity loan, a cash-out refinance may be the right choice for you. This replaces your original mortgage with a larger one, and you receive the difference between the value of the loan and the amount you currently owe in cash.

Finally, if you cannot qualify for a HELOC, a shared appreciation agreement may be worth exploring. This transaction allows you to sell off a stake in your future equity earnings to a company in exchange for an advance on some of your current equity. This type of agreement is typically for homeowners with a lot of equity but little cash reserves, and most consumers are better served by a HELOC if they can get one. You risk losing out on equity profits by mortgaging the future value of your home, so think carefully before choosing this option.

More from NerdWallet

Last updated on March 1, 2023

Methodology

The star ratings on this page reflect each lender's home equity line of credit star rating. HELOC star ratings are awarded based on the following evaluated factors for reviewed mortgage lenders that offer HELOCs: whether a fixed-rate option is available, CLTV borrowing limits, annual fees and transparency on key factors.

NerdWallet reviewed more than 50 mortgage lenders, including the majority of the largest U.S. mortgage lenders by annual loan volume (measured among lenders with at least a 1% market share), lenders with significant online search volume and those that specialize in serving various audiences across the country.

For inclusion in this roundup, lenders must score a 4 or above according to our HELOC methodology.

NerdWallet solicits information from reviewed lenders on a recurring basis throughout the year. All lender-provided information is verified through lender websites and interviews. We also utilized 2021 HMDA data for origination volume, origination fee, average interest rate and share-of-product data.

To recap our selections...

NerdWallet's Best HELOC Lenders of 2023

  • Alliant: Best for large withdrawals
  • Bank of America: Best for fixed-rate option
  • Bethpage Federal Credit Union: Best for large withdrawals
  • Golden 1 Credit Union: Best for no annual fees
  • Guaranteed Rate: Best for large withdrawals
  • Homebridge: Best for no annual fees
  • PenFed: Best for fixed-rate option
  • PNC: Best for existing customers
  • State Employees' Credit Union: Best for long draw period
  • Truist: Best for fixed-rate option

Frequently asked questions

  • Yes, banks are still offering HELOCs. At the beginning of the COVID-19 pandemic, some lenders suspended underwriting new HELOCs. Now, some have resumed HELOC lending and some haven't.

  • Lender requirements vary, but typically you'll need a credit score of 620 or higher. Taking out a HELOC will probably reduce your credit score temporarily when it appears on your credit report.

  • The interest you pay each year on a HELOC is tax-deductible up to a limit as long as the borrowed money is used to buy, build or substantially improve your home, according to the IRS.

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