Best Home Equity Lenders of 2026: Compare Top Options Side-by-Side

Refinancing replaces your existing mortgage with a new loan, which may help you change your rate, term, or monthly payment. A cash-out refinance replaces your existing home loan with a new, larger mortgage, allowing you to convert a portion of your home equity into cash.

Home equity options let you borrow against the value you’ve built in your home while keeping your current mortgage in place.

Learn more about today's top home equity loan pick

What's the difference between a home equity loan and a HELOC?

Both let you borrow against your home's equity, but they work differently:

• Home equity loan: Lump sum upfront, fixed interest rate, predictable monthly payments over a set term (typically 5–30 years). Best for one-time, defined expenses.
• HELOC: Revolving credit line with a variable rate, a draw period to access funds as needed, and a separate repayment period. Best for ongoing or flexible spending needs.

If you value payment predictability, a home equity loan is usually the better fit. If you want the flexibility to borrow over time, a HELOC may make more sense.

Most lenders evaluate a few core criteria:

• At least 15–20% equity in your home
• Credit score of 620 or higher (700+ for the best rates)
• Stable income and employment history
• Debt-to-income ratio below 43%
• Reliable payment history on your current mortgage

Because these loans are secured by your home, lenders may be more flexible with credit requirements than they would for unsecured loans — but stronger profiles will typically get better terms.

Your rate depends on a combination of personal and market factors:

• Credit score: Higher scores unlock lower rates
• Loan-to-value (LTV) ratio: Borrowing less relative to your home's value helps
• Debt-to-income ratio: Lower DTI signals you can handle additional payments
• Loan amount and term: Shorter terms often mean lower rates but higher monthly payments
• Market conditions: Federal Reserve decisions and broader economic trends shift what lenders offer

Improving your credit and reducing existing debt before applying can make a meaningful difference in the rate you're offered.

Start with a simple formula: your home's current market value minus your remaining mortgage balance equals your available equity.

Most lenders allow you to borrow up to 80–85% of your home's value, minus what you still owe. For example: a $400,000 home × 85% = $340,000, minus a $250,000 mortgage balance = up to $90,000 in potential borrowing power. Your actual limit will depend on your credit profile, income, and the specific lender's guidelines.

Closing costs typically run 2–5% of the loan amount. Common fees include:

• Appraisal fee: $300–$600
• Origination fee: 0.5–1% of the loan
• Title search and insurance
• Document preparation and recording fees

Some lenders waive certain fees or offer no-closing-cost options (usually in exchange for a slightly higher rate). Request a Loan Estimate from each lender you're considering so you can compare the true cost side by side.

When it comes to a home equity loan or HELOC, lenders can use different formulas to calculate how much you can borrow. The various factors taken into consideration include your creditworthiness, existing debt, your perceived ability to repay the loan, the appraised value of your home, and the loan-to-value ratio (LTV). In general, the higher the amount of equity you have in your home, the bigger the loan amount you could receive.

See how much cash you could get

Home equity is one of the greatest financial benefits of owning a home. You can tap into the equity you built for multiple reasons, including:

• Debt consolidation: Pay off multiple other types of debt with your home equity loan or line of credit to keep your debt organized and potentially get a low interest rate.
• Home renovations: Use your home equity to help pay for important home renovations and improvements, which can in turn increase your home value.
• Medical bills and emergencies: Cover costly medical bills or other unexpected expenses by tapping into your home equity.
• Large purchases: Use your home equity to cover large expenses involved with weddings, buying a new car, or moving houses.

Calculate how much cash you can get from your home's value

Typically two to six weeks from application to funding. Online lenders tend to move faster than traditional banks or credit unions. To keep things on track, have your documentation ready before you apply — that includes pay stubs, tax returns, W-2s, your current mortgage statement, proof of homeowners insurance, and information about any existing liens. Some lenders may also require a home appraisal. The more prepared you are upfront, the faster the process moves.

Get your rate today