What’s a good HELOC rate in Tennessee?

A good home equity line of credit rate varies based on the homeowner’s needs and credit information. In Tennessee, Bank of America and PenFed Credit Union currently feature the best rates.

What can I use a HELOC for in Tennessee?

Lenders do not restrict how homeowners use HELOC funds in Tennessee. That means you can use the funds for debt consolidation, home renovation, education or medical expenses.

Is HELOC interest tax-deductible in Tennessee?

Interest on HELOCs is often tax-deductible . Speak to your financial advisor for specific details.

How much money can I borrow with a HELOC in Tennessee?

The minimum and maximum HELOC amounts you can borrow vary across lenders and are based on your credit score and income status. Lenders in Tennessee offer HELOCs ranging from $5,000 to $1,000,000.

Is a HELOC better than a home equity loan (HELOAN)?

HELOCs may or may not be better than home equity loans, depending on your financial goals and unique situation. If you need an open-ended credit line with variable interest rates, a HELOC will be the best option. Meanwhile, if you need funding in a lump sum, a HELOAN may be better.

Are HELOC rates fixed?

A home equity line of credit typically features adjustable interest rates that vary depending on the borrowed amount. Some lenders also offer fixed-rate options.

The Best HELOC Rates and Lenders in Tennessee

A home equity line of credit or HELOC is a loan borrowers take out using the value of their home as collateral. HELOCs work like credit cards since borrowers draw the funds as needed, up to a specified limit. You can use the funds to cover various expenses, including medical bills, debt consolidation, education and home renovations.

Advertising & Editorial DisclosureLast Updated: 12/6/2022

Edited By

Margarita Barresi

A HELOC can pay for healthcare expenses, home renovations, tuition and debt consolidation. Homeowners need to meet the lender’s requirements and have substantial home equity.

According to Moneyeek’s analysis, the best overall home equity line of credit provider in Tennessee is Bank of America, although the best option may vary depending on your financial goals.

While looking for a HELOC in Tennessee, shopping around for the best rates and terms is essential.

WHAT WE’RE GEEKING OUT ON

Home Equity Line of Credit Rates
Best HELOC Lender Overall in Tennessee
Best HELOC Lender for Good Credit in Tennessee
Best HELOC Lender for Bad Credit in Tennessee

Home Equity Line of Credit (HELOC) Rates for 2023

The table below summarizes interest rates and other vital details about Tennessee HELOC lenders. The information is based on MoneyGeek’s research as of May 2022.

Lender rates and fees change constantly. MoneyGeek will update the information on an ongoing basis.

Lender
APR
Loan Amount
Min. Credit Score Requirement
Repayment Terms
Annual Fees
Pre-Approval Time
PenFed Credit Union
3.75% to 18%
$25,000 to $1,000,000
660
10-year draw period
and 20-year repayment period
None
N/A
PNC Bank
Not specified
Not specified
Not specified
Not specified
Not specified
Not specified
Bank of America
1.99% special
introductory variable
APR for 6 months,
then as low as
4.35% variable
$25,000 to $1,000,000
Not specified
10-year draw period,
20-year repayment period
Not specified
Not specified
U.S. Bank
3.65% to 8.80%
$15,000 to $750,000
730
10-year draw period,
unspecified repayment period
$90
Not specified
Discover
4.65% to 9.99%
$35,000 to $300,000
620
10 to 30 years
None
1 to 2 weeks
Flagstar
Starting at 3.99%
$10,000 to $500,000
Not specified
10-year draw period
and 20-year repayment period
$75
Not specified
SunTrust/Truist
Starting at 4.64%
$10,000 to $500,000
Not specified
10-year draw period
and 20-year repayment period
None
24 hours
Figure
Starting at 3.50%
$15,000 to $400,000
620
5 to 30 years
3% to 4.99%
24 hours
Citizens Bank
Starting at Prime - 0.50%
Starting at $17,500
Not specified
10-year draw period,
15-year repayment period
$50
Not specified
TD Bank
Starting at 3.34%
Starting at $25,000
740
Not specified
$50
Not specified
Connexus Credit Union
3.49% for 6 months
(4.08% thereafter)
Starting at $5,000
Not specified
15-year draw period
with 15-year repayment period
None
24 hours
Regions Bank
3.75% to 10.63% variable
$10,000 to $500,000
Not specified
10-year draw period,
and then 20 years for repayment
None
Not specified

MoneyGeek’s Picks for Best HELOC Lenders in Tennessee

MoneyGeek’s mission is to provide consumers with the most accurate information about home equity line of credit options to facilitate better decision-making.

Most of the HELOC lenders in Tennessee are national banks. MoneyGeek recommends checking with your local credit unions if a national lender denies your application.

Best Overall HELOC Lender in Tennessee: Bank of America

Bank of America
Bank of America offers interest rate discounts of up to 1.5% on initial withdrawals.
- 1.99% special introductory variable APR for 6 months, then as low as 4.35% variableAPR Range
- $25,000 to $1,000,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- NoneAnnual Fees
- Not specifiedPre-Approval Time
MoneyGeek ranked Bank of America as the top HELOC lender in Tennessee for most homeowners. Bank of America offers its customers a HELOC limit of between $25,000 and $1,000,000. The lender does not charge closing, application or annual fees.
Bank of America has an introductory APR of 1.99% for the first six months. Enabling automatic payments will earn you a discount of 0.25% on your interest rates. The lender also offers a discount of up to 1.5% on initial withdrawals (0.1% for every $10,000 withdrawn).
Bank of America is the best for those who wish to manage their loan online or through a mobile app. The lender may also be a good option if you need a higher HELOC limit. However, the lender’s website does not list its minimum credit requirements or pre-approval times.
Pros
Low introductory APR of 1.99% for six months
$1,000,000 maximum loan limit
Borrowers may choose fixed-rate options
No annual fee
0.25% discount on interest for automatic payments

Cons
Pre-approval time is not clear
Minimum credit score not specified online
APR: 1.99% for six months; 4.35% thereafter
Loan Amount: $25,000–1,000,000
Repayment Terms: 10-year draw period; 20-year repayment period
Minimum Credit Score: Not specified
Annual Fees: None
Pre-Approval Time: Not specified
on Bank of America Website

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

U.S. Bank
Offers a fixed-rate APR option for borrowers with good to excellent credit.
- 4.20% to 9.35%APR Range
- $15,000 to $750,000Loan Amount Range
- 10-year draw period; unspecified repayment periodRepayment Terms
- $90Annual Fees
- Not specifiedPre-Approval Time
Based on MoneyGeek’s research, U.S. Bank offers the best home equity line of credit in Tennessee for those with good credit and a U.S. Bank personal checking account. The lender is also ideal for those who need considerable funding since it offers loans of up to $750,000.
U.S. Bank has a starting APR of 4.20%. To qualify for a HELOC from this lender, you need a minimum credit score of 730, which is high compared to other lenders. You can submit your HELOC application online, at the bank or by phone.
You will pay a $90 annual fee for this loan. U.S. Bank may not be ideal for you if you have poor credit and need a lender that doesn’t charge an annual fee.
Pros
Fixed-rate option available
High loan maximum of $750,000
Multiple repayment options depending on homeowner’s credit qualification
No closing and application fees

Cons
$90 annual fee is high
Minimum credit score of 730 required
Repayment time is unspecified
APR: 4.20%–9.35%
Loan Amount: $15,000–750,000
Repayment Terms: 10-year draw period; unspecified repayment period
Minimum Credit Score: 730
Annual Fees: $90
Pre-Approval Time: Not specified
on U.S. Bank Website

Best HELOC Lender for Bad Credit in Tennessee: Figure

Figure
Figure features an extended repayment period of 30 years.
- From 6.55% to 15.54%APR Range
- $15,000 to $400,000Loan Amount Range
- 5 to 30 yearsRepayment Terms
- NoneAnnual Fees
- 24 hoursPre-Approval Time
Figure is the top home equity line of credit lender in Tennessee for homeowners with bad credit. Figure features a relatively low starting APR of 3.24% and a repayment period that extends to 30 years. Homeowners may borrow a maximum of $400,000 if they meet the minimum credit score requirement of 620.
The lender does not charge an opening fee and pre-approves applications within 24 hours. However, borrowers pay an origination fee of up to 4.99%. You get a 0.25% discount if you enroll in autopay and an additional 0.5% if you join the credit union.
While Future is top-rated for homeowners with bad credit, it may not be a good fit if you need to borrow more than $400,000 or require a lender that doesn’t charge origination fees.
Pros
Lower APR
Quick pre-approval process
Fast online application
Credit score requirement of 620
Swift online customer service

Cons
Origination fees
Annual fees
$400,000 maximum funding
APR: From 3.24%
Loan Amount: $15,000–400,000
Repayment Terms: 5–30 years
Minimum Credit Score: 620
Fees: 3%–4.99% origination fee
Pre-Approval Time: 24 hours
on Figure Website

Best HELOC Lender for Competitive Rates in Tennessee: PenFed

PenFed Credit Union
PenFed Credit Union offers interest-only payments before the repayment period.
- 0.99% for 6 months; 4.25% to 18% thereafterAPR Range
- $25,000 to $1,000,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- $99Annual Fees
- N/APre-Approval Time
MoneyGeek found that PenFred Credit Union is an ideal HELOC lender for homeowners in Tennessee seeking competitive rates. Borrowers need a credit score of 660 to qualify and may receive up to $1,000,000 in funding that can be used for debt consolidation, home improvement, student loans and other significant expenses.
With PenFed, Tennessee homeowners will receive a 0.99% introductory APR for six months and then pay as low as 4.25% afterward. An annual fee of $99 applies if you do not pay the same amount in interest during the previous repayment period.
PenFed is likely not the best option for homeowners who want to avoid annual fees.
Pros
Fixed-rate option available
High maximum limit
0.99% introductory APR

Cons
No online application
Annual fee of $99
Unclear pre-approval time
APR: 0.99% for first six months; 4.25%–18% thereafter
Loan Amount: $25,000–1,000,000
Repayment Terms: 10-year draw period; 20-year repayment period
Minimum Credit Score: 660
Annual Fees: $99 conditional
Pre-Approval Time: Not applicable
on PenFed Credit Union Website

HELOC vs. Home Equity Loans

While it’s easy to confuse a home equity line of credit with a home equity loan, the two are different.

Home equity loans or HELOANs feature fixed interest rates and repayment terms. Lenders issue HELOANs in a lump sum based on the value of your home. A home equity loan is ideal for homeowners seeking a loan option with fixed repayment terms.

Meanwhile, a home equity line of credit features variable interest rates and repayment periods. HELOCs work the same way as credit cards since borrowers withdraw funds during the draw period, up to a maximum limit specified by the lender.

The following table illustrates the difference between HELOCs and HELOANs.

HELOC
Home Equity Loan
Interest Rate
Adjustable interest rate,
but fixed-rate options are available
Fixed interest rate
Monthly Payment
Changes depending on
the amount of money borrowed
Fixed monthly payments
Repayment Terms
During the draw period, borrowers pay
interest on the money they borrowed;
after the draw period, they repay any
principal owed in addition to interest
Repayment starts as soon as
the money is given to the borrower
Fund Disbursements
Line of credit
Lump sum delivery

How to Apply for a HELOC

Most lenders allow you to complete your HELOC application online in a few steps, while others require you to call the lender or visit their office. You will typically need to provide basic information, such as your personal and contact details, to get approved. Here are some steps to guide you through the application process.

Determine how much you need

Create a budget so you apply with a clear understanding of how much you need. HELOCs are ideal for funding large expenses, including debt consolidation, medical bills and home improvement. If you need funds for a small project, consider alternative financing options.

Assess your financial standing

After determining how much you need to borrow, review your financial situation. Check how the repayment amount will affect your financial stability. You should also determine whether you meet the lender’s credit score and income requirements.

Shop around and compare lenders

Lenders offer HELOCs at different rates and repayment terms. To find the right option for your needs, take the time to shop around. Compare APRs, income, credit score and other requirements before deciding.

Apply

Once you are happy with your preferred lender, complete the application and submit it online, in person or by phone. Ensure you have the necessary information, including verified documents like mortgage statements, before starting the application process, as this will save time.

Use funds wisely

Once you receive the funds, keep track of your expenses and repayment dates. Limit the funds to their intended purpose to avoid getting into more debt.

Frequently Asked Questions About HELOCs

HELOCs help you to cover large and unexpected costs over time. MoneyGeek responded to some commonly asked questions about HELOCs in Tennessee.

sources

Bank of America. "Home Equity Line of Credit (HELOC)." Accessed June 22, 2022.
Figure. "Get a Home Equity Line of Credit Fast." Accessed June 22, 2022.
PenFed Credit Union. "PenFed Home Equity Line of Credit (HELOC)." Accessed June 22, 2022.
U.S. Bank. "Home Equity Line of Credit (HELOC)." Accessed June 22, 2022.
Internal Revenue Service. "Publication 936 (2021), Home Mortgage Interest Deduction." Accessed June 22, 2022.
Internal Revenue Service. "Interest on Home Equity Loans Often Still Deductible Under New Law." Accessed June 22, 2022.