BMO Bank: 2024 Home Equity Review

Benefits

• At BMO , home equity loans and lines of credit have no application fees and low or no closing costs.
• A fixed-rate HELOC option gives you the flexibility of a line of credit with the benefit of knowing your interest rate won’t rise.

Drawbacks

• You’ll need a high credit score (typically at least 700) to qualify.
• Doesn't have branches in each of the 48 states it offers HE loans

Home equity loan products offered

You can get either a home equity loan or line of credit (HELOC) with BMO, but the details vary between the two. With a fixed-rate home equity loan, you’ll choose a repayment term from five years to 20 years, with amounts ranging from $25,000 to $150,000. With a variable-rate HELOC, you have the flexibility to borrow as much or as little as you need, between $25,000 and $1,000,000. You’re only charged interest on the amount that you actually borrow. There’s a 10-year draw period when you can access your available credit. After the draw period, you’ll pay the remaining balance over a 20-year term. Notably, you do have the option (for a fee) to convert some of the variable-rate balance to a fixed rate.

You’ll receive a 0.5 percent interest rate discount for setting up autopay from a qualifying BMO account. BMO Premier Services customers might get an additional 0.25 percent rate discount on HELOCs.

Types of fees charged

BMO advertises both home equity loans and HELOCs with no application fees and low to no closing costs. If you close your account within three years, the bank might charge a fee to recoup closing costs. Additionally, the variable-rate HELOC comes with a $75 annual fee during the draw period, and there’s a $75 fee every time you convert a fixed-rate lock option after closing.

How to qualify for a home equity loan with BMO 

The qualifications for a HELOC or home equity loan with BMO are very similar: You’ll need to have a credit score of 700 or higher. You’ll also need to have sufficient income and home equity.

How to apply with BMO

To get started with a home equity loan or HELOC from BMO, you can apply online, over the phone or in person at a branch. The bank displays rates on its website for properties in Arizona, Florida, Illinois, Indiana, Kansas, Minnesota, Missouri and Wisconsin. For all other states, you’ll need to call 800-546-6101 to get rates. The bank’s business hours are Monday through Friday, 8 a.m. to 8 p.m. CT and Saturday, 8 a.m. to 6 p.m. CT.

How Bankrate scored BMO

• 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.