Our best HELOC and home equity loan ratings methodology (2024)

How we rate home equity lenders

We’ve reviewed 25+ lenders and their products to help you find the right home equity line of credit (HELOC) and home equity loan. Each lender product receives a star rating between one and five based on how many points they get for each factor outlined below.

Within each major category, we considered several characteristics, including APR, max combined loan-to-value CLTV ratio and applicable fees. We also evaluated each provider’s customer support options, borrower perks and more.

In general, the best home equity products have rates below the national average and accessible eligibility requirements.

Methodologies

• Home equity line of credit (HELOC).
• Home equity loan.

HELOC methodology

How we chose the products we ranked

To be eligible, each lender must offer HELOCs that are available nationwide. We also consider if any actions have been taken against a lender by the Consumer Financial Protection Bureau (CFPB) or other federal agencies. If so, a lender could be disqualified from our rankings depending on the severity of the violations and their impact on customers.

HELOC ranking factors

Out of all the lenders considered, those that made our list excelled in areas across the following categories (with weightings):

• Loan details: 20%.
• Loan cost: 45%.
• Eligibility and accessibility: 15%.
• Customer experience: 20%.

We base each scoring factor on what potential borrowers value the highest. In other words, we make sure to include the details and data you care about most. Here’s the complete breakdown.

Loan details (20%)

• Draw period (15%): Each product is scored on how long the draw period lasts. While most lenders offer a draw period of 10 years, some have products with a 15-year draw period. Anything above 10 years receives 5 more points.
• Fixed rate option (5%): HELOCs typically come with variable rates, but some lenders will offer a fixed-rate option. This allows you to choose a fixed-rate HELOC, giving you the same rate throughout the draw period instead of a fluctuating variable rate.

Loan cost (45%)

• Interest rates (35%): Our biggest overall factor is the interest rate. But because HELOC rates change daily, we focus on comparing each rate to the national average and give points based on whether the lender’s rate is above or below that number (with anything below receiving the higher rating).
• Perks and reductions (5%): We include any special perks or discounts the lender might offer, including autopay and loyalty discounts, cash back or rewards programs and more.
• Introductory promo rate (5%): Some lenders offer promotional rates to borrowers. These are lower than the standard rate and last a short time at the beginning of the loan term before converting to the standard variable rate. Lenders received 5 points if they offered any intro promo rates.

Eligibility and accessibility (15%)

• CLTV ratio (15%): The maximum CLTV ratio you can have to qualify for a HELOC usually hovers around 85%. Lenders who allow a CLTV of 86% and above get the highest rating; but if the max CLTV allowed is 85% or less, lenders receive the lower rating.

Customer experience (20%)

• Customer support options (10%): We factor in how accessible each lender is to its customers. This includes how many days out of the week customer service is available, the hours of availability and how many different contact options are available (phone, email, chat, etc.).
• Mobile app (5%): If lenders have an official mobile app, they earn 5 points; 0 points for no app.
• Trustpilot star rating (5%): Lenders receive 5 points if they have a 5-star rating on Trustpilot; 4 points for a 4-star rating and so on.

Take a look at our list: Best HELOC lenders

Home equity loan methodology

How we chose the products we ranked

To be eligible, each lender must offer home equity loans that are available nationwide. We also consider if any actions have been taken against a lender by the Consumer Financial Protection Bureau (CFPB) or other federal agencies. If so, a lender could be disqualified from our rankings depending on the severity of the violations and their impact on customers.

Home equity loan ranking factors

Out of all the lenders considered, those that made our list excelled in areas across the following categories (with weightings):

• Loan cost: 40%.
• Eligibility and accessibility: 20%.
• Customer experience: 20%.
• Application process: 20%.

We base each scoring factor on what potential borrowers value most. In other words, we make sure to include the details and data you care about most. Here’s the complete breakdown.

Loan cost (40%)

• Interest rates (25%): Our biggest overall factor is the interest rate. But because home equity loan rates change daily, we focus on comparing each rate to the national average and give points based on whether the lender’s rate is above or below that number (with anything below receiving the higher rating).
• Perks and reductions (15%): We include any special perks or discounts the lender might offer, including autopay and loyalty discounts, cash back or rewards programs and more.

Eligibility and accessibility (20%)

• Credit score (5%): We use the minimum credit score required to qualify for a home equity loan with the lender to take some of the guesswork out of the application process.
• CLTV ratio (15%): The maximum CLTV ratio you can have to qualify for a home equity loan usually hovers around 85%. Lenders who allow a CLTV of 100% and above get the highest rating (rare); 86% to 99% an average rating; and if the max CLTV allowed is 85% or less, the lowest rating.

Customer experience (20%)

• Customer support options (10%): We factor in how accessible each lender is to its customers. This includes how many days out of the week customer service is available, the hours of availability and how many different contact options are available (phone, email, chat, etc.).
• Mobile app (5%): If lenders have an official mobile app, they earn 5 points; 0 points for no app.
• Trustpilot star rating (5%): Lenders receive 5 points if they have a 5-star rating on Trustpilot; 4 points for a 4-star rating and so on.

Application process (20%)

• Closing time (20%): This includes the approximate length of time it will take to close on your home equity loan. The ability to close within 30 days or less awards the most points.

Check out: Best home equity loan lenders

How we collect data

We rely on lenders when doing our research — never on third-party sources. We research each individual lender by reviewing their website and collecting data. Then, we reach out to each lender directly to collect additional information and get clarification on any details we were unable to find on the website.

We regularly recheck and update our lender information. Our data team also researches each lender annually to verify that the data is up to date.

In some cases, lenders don’t disclose certain details on their website and either don’t reply to our inquiries or don’t disclose the information at all. When this is the case, the lender does not receive any points for that factor at all and it’s marked as “Does not disclose.”

USA TODAY Blueprint’s editorial standards

Every article is fact checked by our writers and editors along with our data and compliance teams to ensure we have the most accurate and up to date information. Our team uses a data-driven methodology based on what borrowers value most to determine each rating.

We pride ourselves on our journalistic integrity and our goal is to always empower our readers to make sound financial decisions. Advertisers do not influence any of our content, opinions or evaluations.