Best HELOC Rates and Lenders in Texas for 2024

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ByChristopher Boston
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Reviewed byTimothy Manni
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Updated: December 28, 2023

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A home equity line of credit helps you finance large and unexpected expenses, and most lenders don’t restrict how you can use the funds.

While looking for the best HELOC for your needs, shopping around to secure an option with the best terms is essential. Overall, Bank of America offers the best HELOC in Texas due to its friendly rates and discounts. However, your best lender will depend on various factors, including your credit score.

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Home Equity Line of Credit (HELOC) Rates for 2024

Comparing rates and terms across lenders can help secure the best HELOC option for your financial goals.

The following table provides an overview of home equity line of credit rates and other lender information based on MoneyGeek’s analysis as of May 2022. As lender rates fluctuate, we will keep you informed with regular updates to this table.

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MoneyGeek’s Picks for Best HELOC Lenders in Texas

MoneyGeek determined the best HELOC lenders in Texas to help consumers quickly find the perfect option for their needs.

Typically, not many lenders provide HELOCs, and most of the companies that do are often national banks. To qualify, borrowers need to have good credit scores.

If you submit your HELOC application to one of the national lenders and it gets rejected, find out why you were not approved and seek to remedy that issue before applying again. Additionally, check whether your local credit unions offer HELOCs.

Best Overall HELOC Lender in Texas: Bank of America

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

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Best HELOC Lender for Bad Credit in Texas: Figure

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Best HELOC Lender for Competitive Rates in Texas: PenFed

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HELOC vs. Home Equity Loans

Home equity loans and HELOCs offer easy ways to finance major or unexpected expenses using the value of your home as collateral. Before determining which of the two suits your needs, you should understand their differences.

Home equity loans or HELOANs offer borrowers a lump sum. HELOANs feature fixed interest rates and repayment amounts for the duration of the loan. They may be ideal for borrowers who need a loan with predictable repayment terms.

Meanwhile, HELOCs offer revolving credit the same way credit cards do. They feature variable interest rates and repayment periods. Borrowers can withdraw funds as often as required, provided they do not exceed the lender’s limits. A home equity line of credit loan is ideal for homeowners who need more flexibility around the repayment terms.

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How to Apply for a HELOC

Applying for a home equity line of credit is easy. Most lenders allow you to submit your application online and await approval. MoneyGeek recommends taking the following steps when applying for a HELOC.

1

Determine how much you need

Before submitting your HELOC application, you must understand how much you need and have a plan for how you will use the funds. Most homeowners use the funds to finance home renovations, education, medical bills and debt consolidation.

2

Assess your financial standing

Review your financial situation and determine whether you can meet your preferred lender’s minimum requirements. For instance, you may need to check your income, loan-to-value ratio and credit score, as these will determine your rates.

3

Shop around and compare lenders

Once you are sure of the credit line amount you need, compare HELOC lenders to find the best option. Check the rates, repayment terms, discounts and requirements.

4

Apply

Most HELOC lenders allow you to apply online. However, some may ask you to call or apply in person. You will need to provide details like your personal information, proof of income and assets owned.

5

Use funds wisely

Once you receive the funds, use them for their intended purpose. Always keep in mind that if you fail to make repayments, you may lose your home.

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MONEYGEEK EXPERT TIP

When it comes to taking out a loan that uses your home as collateral, such as a home equity loan or HELOC, you can't go wrong using the borrowed funds on repairs or renovations designed to increase the value of your home and your standard of living. — Timothy Manni, Mortgage and Real Estate Consultant

Frequently Asked Questions About HELOCs

What is a home equity line of credit? Understanding how HELOCs work may be challenging for new borrowers. MoneyGeek responded to frequently asked questions to ensure you choose the best HELOC for your financial goals.

A good rate for your home equity line of credit will depend on various factors, including your credit score and income level. Bank of America and PenFed Credit Union currently provide the best rates in Texas.

In Texas, lenders allow you to use your HELOC funds to finance any significant expenses. These include debt consolidation, home renovations and education.

According to the Internal Revenue Service, your HELOC interest rate is tax-deductible if you use the funds to improve your home. Check with your lender before completing your application.

The credit line amount varies based on your lender and credit information. In Texas, the amount ranges between $5,000 and $1,000,000.

HELOCs and home equity loans are both good funding options for homeowners. However, the best option depends on your situation. A HELOC allows you to make various withdrawals over time, while home equity loans are disbursed in lump sums.

HELOCs feature variable interest rates, which change depending on various factors. However, some lenders allow you to switch to fixed-rate options.

About Christopher Boston


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Christopher (Croix) Boston was the Head of Loans content at MoneyGeek, with over five years of experience researching higher education, mortgage and personal loans.

Boston has a bachelor's degree from the Seattle Pacific University. They pride themselves in using their skills and experience to create quality content that helps people save and spend efficiently.


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