Whether it be for urgent needs, like expenses, or personal needs, like home renovations, a HELOC helps borrowers reap the benefits of their home’s equity. A HELOC is a safe way to loan amounts ranging from $10,000 to $1,000,000 at a rate that works best for you.
Home equity line of credit rates in Arizona range from 0.99% to 18%, but Bank of America has the best combination of price and customer satisfaction. Still, it’s crucial to learn more about the options that are available to make sure that you get the one that works best for you.
Home Equity Line of Credit (HELOC) Rates for 2023
The table below breaks down the terms and rates of different lenders’ HELOC loans. It provides an overview and comparison of HELOC rates, along with basic minimum credit score requirements.
The information included was updated as of May 2022. Although we readily update our information, the lender’s terms and rates are subject to change, so you should always verify with their website.
Lender | APR | Loan Amount | Min. Credit Score Requirement | Repayment Terms | Annual Fees | Pre-Approval Time |
|---|---|---|---|---|---|---|
0.99% introductory APR | $25,000 to $1,000,000 | 660 | 10-year draw period;
| $99 | N/A | |
Not specified | Not specified | Not specified | Not specified | Not specified | Not specified | |
1.99% special | $25,000 to $1,000,000 | Not specified | 10-year draw period;
| None | Not specified | |
4.20% to 9.35% | $15,000 to $750,000 | 730 | 10-year draw period;
| $90 | Not specified | |
Starting at 3.99% | $10,000 to $500,000 | Not specified | 10-year draw period;
| $75 | Not specified | |
Starting at 4.64% | $10,000 to $500,000 | Not specified | 10-year draw period;
| None | 24 hours | |
Starting at 3.24% | $15,000 to $400,000 | 620 | 5 to 30 years | None | 24 hours | |
Starting at Prime - 0.50% | Starting at $17,500 | Not specified | 10-year draw period;
| None | Not specified | |
Starting at 3.34% | Starting at $25,000 | 740 | Not specified | $50 | Not specified | |
3.49% for 6 months; | Starting at $5,000 | Not specified | 15-year draw period;
| $50 | 24 hours | |
3.75% to 10.63% variable | $10,000 to $500,000 | Not specified | 10-year draw period;
| None | Not specified |
MoneyGeek’s Picks for Best HELOC Lenders in Arizona
At MoneyGeek, we strive to inform consumers about the different kinds of HELOC loans available to help you select the best home equity line of credit. It’s important to note that HELOC loans are typically only available from national banks like Bank of America. If a national lender rejects your loan application, MoneyGeek recommends checking with local credit unions for alternative options.
Best Overall HELOC Lender in Arizona: Bank of America
- Bank of America
Bank of America's low introductory APR of 1.99% lasts for six months.
- 7.49% (introductory rate) then 9.90%APR Range
- Generally $25,000 to $1,000,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- NoneAnnual Fees
- UndisclosedPre-Approval Time
Best HELOC Lender for Good Credit in Arizona: U.S. Bank
- U.S. Bank
Borrowers have a fixed-rate option.
- 8.95% to 12.70%APR Range
- $15,000 to $750,000 ($1 million in California)Loan Amount Range
- 10-year draw period; up to 30 years repayment periodsRepayment Terms
- Up to $75Annual Fees
- UndisclosedPre-Approval Time
Best HELOC Lender for Bad Credit in Arizona: Figure
- Figure
Figure only has a minimum credit score requirement of 620, which is one of the lowest on the market.
- 6.10% to 14.74%APR Range
- $20,000 to $400,000Loan Amount Range
- 5 to 30 yearsRepayment Terms
- NoneAnnual Fees
- 24 hoursPre-Approval Time
Best HELOC Lender for Competitive Rates in Arizona: PenFed
- PenFed Credit Union
PenFed Credit Union offers a 0.99% introductory interest rate for six months — one of the lowest on the market.
- Starting at 8.625%APR Range
- $25,000 to $500,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- $99Annual Fees
- UndisclosedPre-Approval Time
HELOC vs. Home Equity Loans
Home equity lines of credit and home equity loans help you fund large expenses using your home as collateral. Knowing the differences between the two is crucial to identify the best solution for your financial situation.
A home equity loan is a one-time payment made to the borrower. Over the life of the loan, the interest and monthly payments are usually fixed. Borrowers who appreciate consistency and wish to minimize overpaying should consider this option.
A home equity line of credit, on the other hand, is a revolving credit line that functions similarly to a credit card. Like a credit card, you can withdraw money on an as-needed basis up to a specified limit and then pay it back.
To learn more about the differences between a home equity loan and a home equity line of credit, you can refer to the table below.
HELOC | Home Equity Loan | |
|---|---|---|
Interest Rate | Adjustable interest rate | Fixed interest rate |
Monthly Payment | May vary depending on | Fixed monthly payments |
Repayment Terms | During the draw period, | Repayment starts as soon as |
Fund Disbursements | Borrowers can withdraw funds | Lump sum |
How to Apply for a HELOC
You can easily apply for a HELOC in person, over the phone or online. The application requirements are similar to that of mortgage applications and can be even less if you have an excellent credit score or only require a small loan amount.
Determine how much you need
Before investing your time preparing requirements for a HELOC application, determine the amount of money you’ll need and consider if a HELOC is your best option. If you’re a financially stable homeowner in need of money to consolidate loans, renovate your house, pay for or save up for college expenses or invest in the stock market, a HELOC may be the right option for you. If you only need a small amount of money, then another type of loan may be more appropriate.
Assess your financial standing
You should evaluate your current financial situation before applying for a loan. Those with a stable income, good credit score and low credit-to-income ratio are more likely to be approved for a HELOC. It’s possible to increase your credit score before applying by paying off existing debt and avoiding borrowing money from banks or loaning companies.
Shop around and compare lenders
Once you’ve determined how much money you need and your capacity to pay off debt, it’s time to search for the right HELOC lender. Read their terms carefully and watch out for prepayment penalties and inactivity fees. Doing proper research will help you find the perfect lender for your financial situation.
Apply
Like we’ve mentioned earlier, applying for a HELOC is easy. The requirements vary from one lender to another, but the basic requirements are income and debt documents, personal information and property value. After submitting the documents and undergoing an interview, the lender will contact you with their application decision.
Use funds wisely
Despite having flexibility for how you can use your home equity line of credit, remember that it’s still a loan that must be repaid. It’s important that you only spend what you can repay so that you don’t risk losing your home.
Frequently Asked Questions About HELOCs
Borrowing money through a home equity line of credit may seem daunting and confusing, but with proper guidance, the process can be a breeze. To get you started, MoneyGeek answered some frequently asked questions about HELOCs.
sources
- Bank of America. "Home Equity." Accessed June 19, 2022.
- Bank of America. "Locators." Accessed June 19, 2022.
- Bank of America. "Home Equity Assumptions." Accessed June 19, 2022.
- Bank of America. "Home Equity Line of Credit Application." Accessed June 19, 2022.
- Figure. "Homeowners, We're Here for You." Accessed June 19, 2022.
- Figure. "Figure Home Equity Line FAQs." Accessed June 19, 2022.
- PenFed. "PenFed Home Equity Line of Credit (HELOC)." Accessed June 19, 2022.
- U.S. Bank. "Home Equity Line of Credit (HELOC)." Accessed June 19, 2022.
- U.S. Bank. "Home Equity FAQs." Accessed June 19, 2022.