Best HELOC Rates and Lenders in Iowa for 2024

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Edited byAshley Jacobs

Updated: December 28, 2023

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Before applying for a HELOC, shop around and compare different lenders to find the best deal for your needs. You can use a home equity line of credit for renovations, education, investment, debt repayment, emergencies and retirement.

HELOC rates can begin with a special promotional variable APR of 0.99% for six months, then increase to a variable APR of up to 18%. MoneyGeek ranks Bank of America as the best overall HELOC lender in Iowa due to its low interest rates and incentives.

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Home Equity Line of Credit (HELOC) Rates for 2024

When shopping for a HELOC, it's important to compare rates and terms from several lenders. This can help you get the best rates.

The MoneyGeek table below highlights home equity line of credit rates and pertinent lender information as of May 2022. We update the table regularly since these details can change at any time.

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MoneyGeek’s Picks for Best HELOC Lenders in Iowa

Since our goal is to help consumers, MoneyGeek created a list of the leading home equity line of credit lenders in Iowa to help you choose the best option for your needs and situations.

You should keep in mind that not many lenders provide HELOCs, and those that do are mostly national banks that exclusively lend to people with good to exceptional credit. If your HELOC application is turned down by a national lender, MoneyGeek recommends looking into local credit unions as an alternative.

Best Overall HELOC Lender in Iowa: Bank of America

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

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Best HELOC Lender for Bad Credit in Iowa: Figure

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Best HELOC Lender for Competitive Rates in Iowa: PenFed

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HELOC vs. Home Equity Loans

Understanding the difference between home equity loans (HELOANs) and home equity lines of credit (HELOCs) is critical when selecting which is the best option for you.

Because a HELOAN is a one-time payment given to a borrower, it will benefit borrowers seeking dependability. The interest rate and monthly payments are usually set for the entire loan term.

Meanwhile, borrowers that are good with money may want to seek a home equity line of credit. Like a credit card, a HELOC allows you to withdraw money as often as you need within a set duration and requires you to repay the amount borrowed. Rates on HELOCs are frequently variable, meaning they might change depending on the economy.

The table below breaks down the differences even further.

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How to Apply for a HELOC

Most lenders allow applicants to supply basic information and wait for approval by using online applications. This makes applying for a home equity line of credit quite simple. MoneyGeek explains how to apply for a HELOC in the section below.

1

Determine how much you need

Before you apply for a home equity line of credit, you need to determine how much credit you will need and how you will utilize it. A HELOC can be used for a range of financial purposes, including debt consolidation, investments and home upgrades. Before applying for a HELOC, you must know your desired credit line amount and how you’ll use it. A HELOC can be used for various financial purposes, including debt consolidation, home renovations and college expenses.

2

Assess your financial standing

You will need to analyze your financial situation, including your credit score, income and current loan-to-value ratio, to see if you meet the borrowing requirements. All of these factors contribute to determining your rates. You can also determine whether or not you have the financial means to repay your debt.

3

Shop around and compare lenders

Only by comparing and examining services, costs and terms across various lenders can you choose the best option for your needs. You should also investigate each lender's annual fees, closing costs and rate discounts.

4

Apply

Even though the majority of HELOC applications are completed online, certain lenders need you to call or apply in person. Usually, you must submit information about your assets and income as part of the application process.

5

Use funds wisely

Commit to your limit after you begin withdrawing to avoid getting into more debt. Remember that if you miss a payment, you could lose your home.

Frequently Asked Questions About HELOCs

Understanding how a home equity line of credit works can be confusing. To help you get started, MoneyGeek has answered some frequently asked questions about HELOCs.

Bank of America and PenFed Credit Union are among the HELOC lenders that offer the most competitive rates in Iowa. A variety of factors influence the rate of your home equity line of credit, such as your credit score and the loan-to-value ratio.

Your HELOC can be used to pay for large expenses like home renovations, college tuition, investments and debt consolidation.

Although it's likely, it's always a good idea to ask a professional. MoneyGeek suggests checking with your accountant or financial counselor to see if the interest on the HELOC is tax-deductible.

HELOC lenders in Iowa will normally allow you to borrow from $5,000 to $1,000,000, depending on the lender, your credit and your income.

HELOCs and home equity loans are both great options, but which one is best for you depends on your circumstances. A HELOC functions like a credit card that allows you to borrow up to a set amount as needed and only pay back what you withdraw. A home equity loan, meanwhile, is a one-time payment with monthly installments and a fixed interest rate.

HELOC rates are variable, meaning they change according to the current economic climate. Other lenders, however, allow customers to switch their home equity line of credit to fixed rates.

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