When will home equity rates fall? These 2 things need to happen first, experts say

The Federal Reserve has kept interest rates high for the last few years, hoping to tamp down spending and get inflation in check. The result has meant increased higher consumer rates and, in turn, increased borrowing costs for virtually every type of loan and financial product.

Fortunately for homeowners, home equity loan and home equity line of credit (HELOC) rates are still on the lower end when it comes to interest rates, especially compared to costly options like personal loans and credit cards. This can make tapping your home equity — something the average homeowner has over $300,000 worth of, about $206,000 of which is tappable — a more attractive option when you’re in need of cash.

There’s a chance home equity loan and HELOC rates could fall further, too. However, some economic conditions would need to change first. Are you considering tapping your home equity for cash? Here’s when you might expect home equity rates to move lower — and what could drive them there.


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