Here’s how far HELOC costs have fallen since 2024 (and what borrowers should do now)

About $11 trillion.

It is How much home equity is considered leverageable by owners right now, according to a report released earlier this month by the Intercontinental Exchange (ICE). With nearly $17 trillion in total equity currently, this could provide a viable financing source for owners needing additional financing in today’s challenging economic climate. And with a Home Equity Line of Credit (HELOC)they can do it with a product that is cheaper than most other home equity products and even cheaper than personal loans or credit cards.

At the same time, HELOCs, like their home equity loan counterparts, use your house as collateral. Failure to repay anything borrowed may result in foreclosure. It is therefore essential that costs are managed carefully and that owners go into the process informed and prepared. This starts with some understanding of the current HELOC space and how costs have improved in recent years. Below, we’ll detail what borrowers need to know (and what they need to do) to take advantage of this timely opportunity.

Start by seeing how much home equity you could borrow here.

Here’s how much HELOC costs have fallen since 2024

“The cost of borrowing against equity continues to improve,” the March ICE report said.

“HELOC rates have fallen from about 10% two years ago to about 7% at the end of 2025, reducing the monthly cost to leverage $50,000 of equity from $412 to $296, a reduction of about 30%,” the report notes. “Two additional Fed cuts planned for 2026 could lower that monthly cost by about 10% more, making stock mining increasingly affordable.”

This is especially important for both current and potential HELOC borrowers because the product has a variable interest rate that changes monthly depending on market conditions. So, if the Fed decides to cut rates again or if market conditions change, HELOC rates could fall again. And borrowers will benefit from this reduction independently, without having to refinance or pay for refinancing closing costs as they would have to do with alternative products like home equity loans.

At the same time, this variability could also be problematic if rates rise, so borrowers should compare their repayment costs to a series of realistic rate scenarios to best determine long-term affordability.

Find out how low your current HELOC rate offers are right now.

What Potential HELOC Borrowers Should Do Now

If changes in the HELOC interest rate space have encouraged you to act, consider starting with these next steps:

• Determine the intended use of HELOC: HELOCs are not suitable for all financing needs, depending on the source used. Home repairs and renovations may be sufficient, for example, because a HELOC used there may be accompanied by tax advantages for borrowers. Debt consolidationlikewise, may make sense right now. However, using a HELOC to pay for a family vacation or a new car should generally be avoided.
• Research rates and lenders: You don’t need to use your existing mortgage lender to borrow against the equity in your home.nor should you do it if competitors offer better rates and deals. However, you won’t know your options until you take the time to research rates and lenders (and, luckily, it’s easy to do that online right now).
• Calculate your reimbursement costs: As noted, HELOC rates will change, especially over an extended period of time. It is therefore essential that borrowers calculate their costs both with the rates available today and with what they could be if they increase or decrease.

The essentials

With HELOC costs having fallen about 30% over the past two years, this could be the smart way to borrow money right now. And with the variable rate well-positioned to fall alongside additional rate cuts announced later in the year, it could quickly become even more affordable for homeowners. That said, with the house serving as collateral, you will want to take a strategic and informed approach to avoid the risk of foreclosure. Then consider speaking to a lender who can answer your questions and help you develop a tailor-made (and secure) borrowing plan.