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.
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 |
|---|---|---|---|---|---|---|
3.75% to 18% | $25,000 to $1,000,000 | 660 | 10-year draw period | None | 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, | Not specified | Not specified | |
3.65% to 8.80% | $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 3.50% | $15,000 to $400,000 | 620 | 5 to 30 years | 3% to 4.99% | 24 hours | |
Starting at Prime - 0.50% | Starting at $17,500 | Not specified | 10-year draw period, | $50 | 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 | None | 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 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.
- 9.55%APR Range
- $25,000 to $1,000,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- NoneAnnual Fees
- Not specifiedPre-Approval Time
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.
- Not specifiedAPR Range
- $15,000 to $750,000Loan Amount Range
- 10-year draw period; unspecified repayment periodRepayment Terms
- $90Annual Fees
- Not specifiedPre-Approval Time
Best HELOC Lender for Bad Credit in Tennessee: Figure
- Figure
Figure features an extended repayment period of 30 years.
- 8.25%APR Range
- $15,000 to $400,000Loan Amount Range
- 5 to 30 yearsRepayment Terms
- NoneAnnual Fees
- 24 hoursPre-Approval Time
Best HELOC Lender for Competitive Rates in Tennessee: PenFed
- PenFed Credit Union
PenFed Credit Union offers interest-only payments before the repayment period.
- Not specifiedAPR Range
- $25,000 to $1,000,000Loan Amount Range
- 10-year draw period; 20-year repayment periodRepayment Terms
- $99Annual Fees
- Not SpecifiedPre-Approval Time
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, | Fixed interest rate |
Monthly Payment | Changes depending on | Fixed monthly payments |
Repayment Terms | During the draw period, borrowers pay | Repayment starts as soon as |
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.