Compare Home Equity Loan Rates and Lenders
Review current home equity loan rates for September 22, 2017 and get personalized mortgage quotes from top lenders
- Loan Type
Mortgage Rates by Loan Product
Mortgage Rate ReportFriday, September 22, 2017
Although the Federal Reserve left interest rates unchanged at its September meeting, its move to start unwinding its balance sheet by selling U.S. treasuries and mortgage-backed securities as well as its confirmation of a rate hike before the end of the year pushed mortgage rates higher across the board. Mortgage rates had been on a multi-week low streak and although the Fed kept the federal funds rate steady at 1.000% to 1.250%, the decision to start its previously announced balance sheet shrinking program in October moved treasury yields higher and mortgage rates followed suit.
In its September statement, the Fed highlighted labor market strength, improving household spending and growing business investment as offsets to declining inflation in deciding to keep the federal funds rate unchanged. The Fed's decision to start unwinding its balance sheet in October as well as the uncertain impact of the Fed ramping up activity over several months pushed mortgage rates higher.
The interest rate for a 30 year fixed rate mortgage increased .125% to 3.750% and jumbo mortgage rates also moved higher to 3.875%. The interest rate for a 15 year mortgage rose .125% to 3.000%. The interest rate on a 5/1 adjustable rate mortgage (ARM) also edged higher to 2.875%, remaining attractive to borrowers focused on shorter-term mortgage programs. VA mortgage rates and FHA mortgage rates also inched .125% higher to 3.375% with both programs remaining attractive for home buyers seeking low or no down payment loan options. Consistent with the overall trend, non-owner occupied mortgage rates moved .125% higher to 4.000%.
This week's rise in mortgage rates snapped a month-long trend of very low and unusually steady market conditions and reinforces that rates are highly challenging to predict. Although the Fed did not change rates, its economic outlook or forecast for future rate hikes, its actions increased market uncertainty which usually leads to higher mortgage rates. Despite the increase, mortgage rates remain near historical lows and borrowers should consider taking advantage of favorable lending conditions. With a rate hike expected before year end as well as three more anticipated hikes in 2018, prospective borrowers looking to buy a home or refinance their mortgage may be able to lock in a lower interest rate by acting sooner rather than later, before mortgage rates rise again, potentially at an accelerated pace.
Because mortgage rates change daily, we continue to actively monitor the mortgage market for changes. Borrowers should check the FREEandCLEAR mortgage rate tables regularly to review customized, updated mortgage rates for lenders in their area. Our rate tables are free to use and require no personal information.
Why Select a Home Equity Loan or HELOC
Only Access the Amount of Money You Need.
A home equity loan or HELOC enables you to access the specific amount of money you need as compared to a full refinance of your mortgage. A smaller loan amount means that your monthly payment and total interest expense over the life of the loan are lower with a home equity loan or HELOC.
Flexible Financing Option.
Most lenders impose relatively few limits on how borrowers use the proceeds from a home equity loan or HELOC. You can use the money from a home equity loan or HELOC for any number of reasons including to pay-off expensive credit card debt, for home improvements or even school tuition. Although most lenders want to understand how you plan on using your loan proceeds, a home equity loan or HELOC provides you significant flexibility on how you use the equity in your home.
Less Expensive and More Efficient than a Refinance.
A home equity loan or HELOC are less costly and time-consuming compared to alternate ways of tapping the equity in your home including a cash-out refinance. Transaction expenses and fees for a home equity loan or HELOC are typically less than the closing costs to refinance your mortgage because the loan amount is smaller. Additionally, the application and closing process for a home equity loan or HELOC are shorter than the time frame for a refinance.
Increased Borrowing Capacity.
Lenders typically apply a higher borrower debt-to-income ratio for a home equity loan or HELOC than for a mortgage, which potentially enables you to borrower more money. For example, depending on multiple factors, the maximum debt-to-income ratio for a mortgage is typically 45% to 50% while the maximum debt-to-income ratio for a home equity loan or HELOC is usually 55% or possibly higher under certain circumstances. Using a higher debt-to-income ratio enables you to borrow more money. With a home equity loan or HELOC, to determine what size loan you qualify for lenders primarily focus on the value of your home and the combined loan-to-value (CLTV) ratio of your first mortgage plus your home equity loan or HELOC.
Why Borrowers Compare Mortgage Rates on FREEandCLEAR
Comparing mortgages can save you thousands. Use our rate tables to find the mortgage with the lowest rates and fees
Our rate tables put you in control. You can compare lenders anonymously plus you never need to provide your social security number
Review mortgage rates from leading lenders. Our lenders offer highly competitive terms to win your mortgage business
More FREEandCLEAR Mortgage Resources
Understand how a home equity loan works including interest rate, qualification requirements and other key loan terms
Review our comprehensive overview of of how a HELOC works including loan-to-value ratio limits, types of HELOC and other guidelines
Review our detailed comparison of a home equity loan and a HELOC to determine the financing option that is right for you
Review an informative explanation of the trade-offs between a home equity loan and a mortgage refinance