Better: 2024 Home Equity Review

Benefits

• With a Better HELOC, you might be able to access up to 90 percent of your home’s equity.
• Along with primary residences, Better allows borrowers to take out HELOCs on a second home or investment property.

Drawbacks

• At closing, you’re required to draw at least $50,000 or 75 percent of your credit line limit, whichever is greater. (On a $500,000 line, that equals $375,000.)
• To get the lowest possible rate, you’ll need to take a minimum line of $150,000, among other qualifying factors.

Home equity loan products offered

Better offers home equity lines of credit (HELOCs) between $50,000 and $500,000, up to 90 percent of your equity. This includes the lender’s One Day HELOC, that returns borrowers approval decisions within 24 hours of locking their rate, provided the borrower gives Better all required documentation within four hours of the lock. Once approved, you can access the cash in seven days. 

You can withdraw funds for three years, during which time you’ll only pay interest. Following those three years, you’ll enter a “hold” period of seven years in which you’ll continue to make interest payments, but can no longer draw funds. After that, you’ll enter a 20-year full repayment period.

Types of fees charged

Better doesn’t charge any fees for a HELOC, according to a company representative. That said, you might be able to pay points (up to 5 percent of the credit line) in exchange for a lower rate. You’ll also be responsible for closing costs such as appraisal, credit report and recording fees.

How to qualify for a HELOC with Better

To get the absolute best rate on a HELOC from Better, you’ll need a high credit score of at least 780 (at least 680 for the One Day HELOC) and a combined loan-to-value (CLTV) ratio of no more than 64 percent, and to take out a credit line of at least $150,000.

How to apply with Better

You can apply for a HELOC from Better through the lender’s website. You’ll need to set up an account to do so.

How Bankrate scored Better

• Methodology

  To determine a home equity lender's Bankrate Score, Bankrate rates lenders on a scale of one (1) to five (5) stars — with five (5) the highest rating — based on a variety of factors relating to the lender's products and services. To assign our ratings, we assessed each mortgage lender across three core areas:

  • Affordability: Annual percentage rate (APR) - 80%; introductory APR - 20%
  • Availability: Licensing - 50%; credit score - 20%; loan minimum - 10%; draw requirement - 10%; loan products - 10% 
  • Borrower experience: Rate transparency - 45%; convenience - 35%; customer service - 10%; fixed-rate options - 10%

  Learn more about our methodology.