MoneyWatch: Managing Your Money
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February 20, 2026 / 11:15 AM EST
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HELOC and home equity loan interest rates have declined considerably in recent years.
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If you have a robust funding source worth, on average, hundreds of thousands of dollars that you could borrow from with ease and affordability, would you consider doing so? That’s the question homeowners in need of extra financing are currently contemplating after the average home equity level in the United States hit a record high in 2025. That leaves the average homeowner with a large amount of money to leverage and, if they do so for eligible home repair projects, they may even be able to deduct the interest paid from their tax bill for the years in which the product was used.
But that’s not the only advantage of using a home equity line of credit (HELOC) or home equity loan right now. Both products come with interest rates materially lower than what even qualified borrowers would otherwise secure with a personal loan or credit card. And, if homeowners use a HELOC now, they may even be able to exploit today’s cooling interest rate environment even further, thanks to the product’s variable rate that will change monthly based on market conditions.
Before jumping in, however, it’s important to know where rates stand right now, as of February 20, 2026. With your home serving as collateral in these exchanges, you’ll want to ensure affordability before securing any funding. Below, we’ll detail the rates you need to know to best inform your next steps.
See how much home equity you would be eligible to borrow here.
What are today’s HELOC interest rates?
The average HELOC interest rate is 7.11% as of February 20, 2026, according to Money. That’s slightly lower than where HELOC rates sat earlier this week. And with rates on personal loans over 12% now and credit card rates still hovering around 20% (or higher), a HELOC clearly stands out as one of the very best ways to borrow money right now.
That said, the variable rate here can be both a pro and a con, depending on the rate climate in which you are operating. Before getting started, then, calculate your potential costs against a variety of rates, including what you qualify for now and what the rate could be in the months and years to come. This will better ensure affordability and better prevent any foreclosure risks, too.
Get started with a HELOC online today.
What are today’s home equity loan interest rates?
The average home equity loan interest rate is 6.95% as of February 20, 2026, according to Money. Not only is that rate lower than all of the aforementioned alternatives, but it’s also fixed, meaning that when you lock it in today, it will remain the same even if the overall rate climate heats up again in the future.
On the opposite end, however, the rate will be the same if the interest rate climate continues to cool further, too. So you’ll need to consider both scenarios before acting. That said, home equity loans can be refinanced if rates improve considerably in the future, but that will come with the added expense of home equity loan refinancing closing costs.
The bottom line
The average HELOC interest rate as of February 20, 2026, is 7.11%, and it’s just 6.95% for home equity loans. With a robust funding source and an affordable rate, home equity borrowing may make sense right now. Consider speaking with a lender, then, who can answer any questions you may have and help you better decide between a HELOC or home equity loan for your financial needs and goals.
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