Home equity news: HELOC rates are unexpectedly up, while economic concerns grip the housing market
Economic uncertainty continues to reign supreme on the real estate scene, as HELOCs rise but home equity loans drop. In this weekly roundup, we ask: Is the housing market headed for a pronounced slump — and what could happen to your HELOC if it does? We also explore how government layoffs may impact consumer mortgage protections and how tariffs and mass deportations could make homes even less affordable. Plus, some industry news: the biggest players in home equity financing, and what the merger between lenders Rocket Mortgage and Mr. Cooper could mean for consumers.
The top stories in home equity, mortgages and real estate
What can happen to HELOCs in a housing slump
If the U.S falls into a recession, it could make it more difficult for homeowners holding home equity lines of credit (HELOCs). If history is any guide, a drop in housing prices – and values – could prompt lenders to freeze, reduce, or even demand full payment of your credit line. What are the best ways for homeowners to prepare?
Is a housing crash on the horizon?
There’s a lot of buzz that the housing market is about to crash: Softening price appreciation, longer days on the market, bigger price cuts and seller concessions. And don’t forget to factor in President Trump’s trade wars and mass deportations. But our experts beg to differ, saying the market is headed for a “soft landing” rather than a collapse on the scale of the Great Recession. We explore all the reasons why.
Layoffs could put mortgage protections in limbo
The job cuts at regulatory agencies that oversee the mortgage market, like the Consumer Financial Protection Bureau, the Department of Housing and Urban Development and the Federal Housing Finance Agency have been fast and furious. So who’s going to oversee lenders, and enforce the regulations designed to protect consumers?
How the President’s policies could make homes (even) less affordable
Americans already dealing with high home prices and mortgage rates could be squeezed even more by the administration’s tentpole policies on tariffs and immigration. Many economists project these policies will lead to increased construction costs, a reduced labor force and an increase in interest rates. We share tips on how consumers can navigate these uncertain times.
Who’s who in home equity lending
As housing values and home equity levels have climbed to new highs, homeowners are tapping into their homes for cash with HELOCs and home equity loans. Where are they getting them? Big names like Bank of America, Citizens Bank, PNC Bank and others led the charge in home equity lending in 2024, doling out billions of dollars in loans last year. Here’s our list of the largest lenders.
The score on how HELOCs hit your credit score
Like any debt, a HELOC gets reported on your credit history. A lender checking your credit score when you apply for a HELOC is pretty much a given, but it’s how you use and manage the HELOC after it’s open that will significantly impact your score – and your creditworthiness.
Source: Cotality
Rates round-up
HELOCs rise, while home equity loan rates fall …
A split decision for home equity rates in the latest week. After falling for six consecutive weeks, HELOCs rose to 8 percent. Meanwhile, the average $30,000 home equity loan dropped slightly to 8.38 percent.
…and mortgage rates jump
Mortgage rates climbed in the latest week, with the 30-year fixed rate averaging 6.83 percent, according to Bankrate’s latest lender survey.
In case you missed it
Technically, these stories were released in previous weeks, but they’re still worth highlighting.
Two large lenders link up
There’s consolidation going on in the mortgage space. Rocket Mortgage announced plans to buy Mr. Cooper in a $9.4 billion all-stock transaction. Can Rocket, the second largest originator of mortgages and Mr. Cooper, the largest home loan servicer in the nation, make good on their promise to drive down costs and improve the experience for their nearly 10 million combined clients?
How to use your HELOC responsibly
A HELOC can give you access to cash for everything from home renovations and education costs to consolidating debt and more. But just because you can use a HELOC for virtually everything (even expensive vacations and cars), it doesn’t mean you should. Is now the right time to borrow against your home’s value?
