Navy Federal Credit Union Home Equity Loan Review 2024
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Our Take
5.0
Navy Federal Credit Union stands out for its high borrowing limit: Customers can convert up to 100% of their home equity into cash — more than most lenders allow. Borrowers have a broad selection of repayment terms, ranging from five to 20 years. The lender doesn’t charge an application fee or closing costs. However, credit union membership is limited to veterans and members of the armed forces, as well as their families and some civilian employees of the Department of Defense.
Pros
- Borrowers can access up to 100% of equity, higher than most lenders.
- Flexible term options: 5, 10, 15 or 20 years.
- No application fee, closing costs or prepayment penalty.
Cons
- Minimum loan amount of $10,000.
- Can’t customize a rate estimate on the website.
- Credit union membership is limited to those with U.S. military connections.
Lender | Max. loan amount | Max LTV | Min. credit score | |
|---|---|---|---|---|
$400,000 | 85% | 640 | Visit Lenderat Figure at Figure | |
$750,000 | 80% | 580 | Visit Lenderat New American Funding at New American Funding | |
$1,000,000 | 85% | 670 | Visit Lenderat Bethpage Federal Credit Union at Bethpage Federal Credit Union |
Full Review
Navy Federal home equity loan rates and transparency
Most home equity loan interest rates are affected by the movement of a base rate called the prime rate. Your rate will include a margin the lender has added to the prime rate. These margins depend largely on factors like your credit score, your existing debt, your income and the amount you wish to borrow. They will vary by lender.
Current prime rate | Prime rate last week | Prime rate in the past year — low | Prime rate in the past year — high |
|---|---|---|---|
7.75% | 8% | 7.75% | 8.50% |
Navy Federal lists sample home equity loan rates online as the lowest possible APR for each term length. However, it doesn’t offer the option to customize your rate estimate, such as by location or credit score. On the day we checked, sample fixed-rate APRs were listed as low as:
7.34% for a 5-year home equity loan.
7.65% for a 10-year home equity loan.
7.95% for a 15-year home equity loan.
8.35% for a 20-year home equity loan.
The lender’s website does not list any discount options.
Applying for a Navy Federal home equity loan
Borrowers who are not yet Navy Federal members will need to join the credit union and create an account. Then, you can access the home equity loan application online. It’s also possible to apply over the phone.
Phone support is available 24/7 — a plus for servicemembers stationed overseas or working irregular hours. Borrowers can also use an online booking tool to make an appointment at one of more than 360 branch locations worldwide.
Navy Federal’s website also has a chatbot available 24/7, and a live chat feature available Monday through Friday from 9 a.m. to 6 p.m. ET.
Navy Federal doesn’t specify a minimum credit score for home equity loan borrowers. An appraisal is required.
What you should know about Navy Federal home equity loans
Navy Federal’s home equity loan stands out for its high borrowing limit: Customers can access up to 100% of their home equity (many lenders cap out at 85%). The maximum loan amount is $500,000. Unlike some competitors, Navy Federal does not charge closing costs or prepayment penalties, and there is no application fee.
Navy Federal offers more term options than most lenders we review. Borrowers can choose a term length of five, 10, 15 or 20 years.
And with the exception of homeowners in Texas, borrowers are also able to get a home equity loan on a second home.
» MORE: Best home equity loan lenders
Alternatives to a Navy Federal home equity loan
Andrews Federal Credit Union has broader requirements to qualify for credit union membership, but physical branches are limited to mid-Atlantic states. Pennymac also offers a wide range of loan term lengths, but charges an application fee.
Home equity loans let homeowners access a lump sum by converting equity into debt. You’ll repay the loan at a fixed interest rate over an agreed period of time. Alternatives to a home equity loan include a home equity line of credit (HELOC) or a cash-out refinance. HELOCs offer greater flexibility to withdraw funds, up to the credit limit, as needed, but often have adjustable interest rates. A cash-out refinance replaces your existing mortgage with a larger loan. It will be most appealing if mortgage rates are lower than your current rate, and closing costs will apply.
Navy Federal offers both a HELOC and a cash-out refinance option.
NerdWallet’s home equity loan star ratings are awarded by the editorial team based on the following evaluated factors: maximum combined loan-to-value ratio, available terms, closing costs, application fees, appraisal requirements, interest rate transparency, digital application availability, customer support experience and whether the lender has been subject to government penalties exceeding $1 million.
