Home Equity Loan Rates in Michigan

The equity in your home that you can access and borrow is known as tappable equity. According to TransUnion, tappable equity in Michigan averages $110,000. A home equity loan (HEL) can help you maximize your home equity, whether you're looking to fund home improvement projects or consolidate debt.

Michigan's home equity loan rates are 7.7% APR for a 10-year term, the same as the national average, and 8% APR for a 15-year term, slightly higher than the national average of 7.9%. We've compiled detailed insights on current home equity loan rates in Michigan, including city-specific rates, top lenders and tips on securing the best rates for using your home's equity.

Key Takeaways

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Higher LTV ratios lead to higher rates. The average APR for a 15-year HEL in Michigan with an 80% LTV is 7.8%, compared to 8.3% for a 90% LTV.

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HEL rates vary by city in Michigan. For example, for 15-year loans, Stanton has an average APR of 6.3%, whereas Clawson's is 12%.

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Different lenders offer varying rates for the same loan types. United Bank of Michigan's average APR is 5.3%, whereas KeyBank National Association's is 11.9%.

MoneyGeek examined 106 different banks and credit unions in Michigan using S&P Global's SNL Depository Rates dataset to stay current on the latest home equity loan rates.

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This data is accurate as of November 2024.

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Current Home Equity Loan Rates in Michigan

The current average APR for a 15-year home equity loan in Michigan is 8%. Several factors might affect what lenders offer you. For instance, a higher credit score often results in a lower APR, while a larger loan amount could lead to a higher rate. Repayment terms also play a role in determining your rate. Check out the table below to compare the average APRs for home equity loans in Michigan across different loan terms.

10Year7.7%
15Year8.0%
5Year7.5%

Interest rates for a home equity loan change daily. Keeping track of these rates means you'll pay less in interest over the life of the loan, saving you money. If you have high-interest debts, a home equity loan at a lower rate can help you consolidate those debts and reduce your overall interest payments.

For example, a 15-year home equity loan with an 8% APR results in a monthly payment of $478 and a total interest of $36,009. In contrast, a 10-year loan with a 7.7% APR has a monthly payment of $599 and a total interest of $21,849.

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HOME EQUITY LOANS VS. HELOCS IN MICHIGAN

Home equity loans and home equity lines of credit (HELOCs) are popular options for homeowners to tap into their home's equity. In Michigan, home equity loans have fixed rates, averaging 7.7%, while the best HELOC rates in Michigan are variable, averaging 8.4%. Home equity loans have fixed rates, offering predictability, whereas HELOCs have variable ones, which can lead to changing payments over time.

Fixed rates mean your monthly payments will remain consistent, making budgeting easier. On the other hand, home equity line of credit (HELOC) rates in Michigan can start lower but may increase, leading to higher payments as interest rates change. Choosing between them depends on your financial situation and comfort with potential payment fluctuations.

Home Equity Loan Rates by LTV Ratio

The rate you qualify for depends on your loan-to-value ratio, which is how much you owe on your mortgage compared to your home's appraised value. To calculate your LTV ratio, divide your current mortgage balance by your home's appraised value and multiply by 100. For example, if your home is valued at $300,000 and you owe $240,000 on your mortgage, your LTV ratio is 80%.

A higher LTV ratio means greater potential risk to lenders, resulting in higher rates. Currently, the average APR of a 15-year equity loan in Michigan with an LTV ratio of 80% is 7.9%. It's 8.3% for an LTV ratio of 90%. Use the table to see what average home equity loan rates you might qualify for based on your LTV ratio.

Data filtered by:Results filtered by:
Repayment Terms:
Repayment Terms:10Year
7.6%8.1%

Home Equity Loan Rates by City in Michigan

Average APRs vary between cities in Michigan due to factors such as lender competition in more densely populated areas, which can lead to lower interest rates. Additionally, differences in property taxes or local fees can influence rates, affecting overall borrowing costs.

In Michigan, Stanton has an average APR of 5.9%, while Clawson's average APR is 11.9%. Below is a table showing the cities in Michigan and their average home equity loan rates for different terms.

Data filtered by:Results filtered by:
City:
City:Detroit
10Year8.4%
15Year8.8%
5Year8.2%

Home Equity Loan Lenders in Michigan

Home equity loan rates in Michigan vary considerably between lenders due to different policies and market strategies. For instance, United Bank of Michigan offers the lowest average APR at 5.3%, while KeyBank National Association has the highest at 11.9%. It's essential to compare rates and terms from various lenders to find the lowest home equity loan rates.

Explore the interactive table below to see which lenders offer the lowest home equity loan rates in your city. This will help you make a more informed decision and potentially save on your loan.

Data filtered by:Results filtered by:
City:
City:Detroit
Zeal Credit Union6.5%
Public Service Credit Union6.9%
First Merchants Bank7.6%
DFCU Financial7.9%
Lake Trust Credit Union8.0%
Credit Union ONE8.3%
Community Financial Credit Union8.4%
Security Credit Union8.4%
Flagstar Bank8.5%
PNC Bank9.6%
Fifth Third Bank10.9%
KeyBank National Association11.9%
Diversified Members Credit Union
Michigan First Credit Union
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COMPARING HOME EQUITY LOAN RATES: BANKS VS. CREDIT UNIONS

Considering credit unions for home equity loan rates in Michigan can be beneficial due to their competitive rates. While commercial banks in Michigan have an average APR of 8.4%, credit unions offer a lower rate of 7.6%. Keep in mind that credit unions might have stricter membership requirements than banks.

How to Get the Best Home Equity Loan Rate in Michigan

Securing the best possible home equity interest rates can lower your monthly payments and total borrowing costs, freeing up funds for other goals. To secure the best home equity loan rates in Michigan, consider these strategies:

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    Compare lenders

    Lenders may offer different APRs for the same loan amount and credit profile. For instance, Michigan United Credit Union advertises an average APR of 5.8%, while Fifth Third Bank offers 10.9%. Comparing different home equity loan lenders in Michigan can help you find better rates.

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    Increase your home's equity

    Having more equity in your home can result in more competitive rates from lenders. Michigan homeowners can increase their home's equity by remodeling basements or installing energy-efficient windows.

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    Improve your credit score

    Increasing your credit score can lead to more competitive home equity loan rates. Pay bills on time and reduce credit card debt to improve your credit score. The average credit score in Michigan is 719, according to Experian.

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    Decrease debt-to-income ratio

    A lower debt-to-income (DTI) ratio — the percentage of your monthly income that goes toward paying debts — can lead to better rates as lenders see you as a less risky borrower.

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Debt-to-Income Ratio Calculator

Provide your income and recurring payments to calculate your DTI.

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FAQ About Home Equity Loan Rates in Michigan

MoneyGeek addresses common questions about home equity loan rates in Michigan, offering clear and reliable information to homeowners.

What is the interest rate on a home equity loan in Michigan?

How do you calculate your home equity in Michigan?

Do home equity loan rates vary between cities in Michigan?

Does a home equity loan in Michigan have tax benefits?

What are possible drawbacks of securing a home equity loan in Michigan?

How long does it take to get a home equity loan in Michigan?

How do you get a home equity loan in Michigan?

What can I use my funds for? Are there any home equity loan use restrictions in Michigan?

Can you only take out a home equity loan in Michigan on your primary residence?

What other home equity products can you consider if you want to tap into your home's equity in Michigan?

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

About Zachary Romeo, CBCA


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Zachary Romeo is a certified Commercial Banking and Credit Analyst (CBCA), and the Head of Loans and Banking at MoneyGeek. Previously, he led production teams for some of the largest online informational resources in higher education, with over 13 years of experience in editorial production.

Romeo has a bachelor's degree in biological engineering from Cornell University. He geeks out on minimizing personal debt and helping others do the same through people-first content.


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