Best HELOC Rates and Lenders in Arizona for 2024

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Edited byMorgan Hull

Updated: December 28, 2023

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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.

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Home Equity Line of Credit (HELOC) Rates for 2024

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.

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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

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Best HELOC Lender for Good Credit in Arizona: U.S. Bank

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Best HELOC Lender for Bad Credit in Arizona: Figure

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Best HELOC Lender for Competitive Rates in Arizona: PenFed

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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.

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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.

1

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.

2

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.

3

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.

4

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.

5

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.

HELOC rates vary depending on your credit score. Competitive lenders such as the PenFed Credit Union and Bank of America offer rates as low as 0.99% and 1.99%, respectively, for the first 6 months.

There are many uses for HELOCs in Arizona. It can be used for home renovations, debt consolidation or stock market or real estate investments.

The interest on a HELOC is tax-deductible if the money borrowed is used for home renovations, specifically to “buy, build, or substantially improve,” according to the Internal Revenue Service or IRS.

The minimum amount of money you can loan in Arizona is $5,000, while the maximum is $1,000,000.

It depends based on your needs. HELOCs are great for homeowners that want a flexible spending amount. Meanwhile, HELOANs are best if you already have a fixed amount of money to borrow and an exact project you will spend it on.

Most HELOC rates are variable based on current market rates, but there are fixed-rate options that lock in an interest rate for a portion or the entire duration of the HELOC.

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