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PenFed Credit Union: 2025 Home Equity Review

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Updated on May 14, 2025

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Pentagon Federal Credit Union logo
NMLS: 401822
Bankrate score

4.5

Rating: 4.5 stars out of 5
Our methodology
Customer score

0.0

Rating: 0 stars out of 5
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PenFed Credit Union overview

In business since 1935, PenFed (officially Pentagon Federal) was founded in 1935 as a credit union for government and military employees. Today, it is the third-largest credit union in the U.S., with 2.9 million members around the country (enrollment is now open to all) and $35.4 billion in assets.

How Bankrate scored PenFed Credit Union

Affordability: 5/5

  • APR: PenFed has extremely competitive rates on its HELOCs. It also offers the latitude for HELOC borrowers to switch between fixed and variable interest rates on their line of credit. 
  • Fees: $99 annual fee on all HELOCs. Credit lines of $400,000 and up incur appraisal fees and possibly other closing costs.

Because PenFed’s interest rates are consistently on the low end and they charge few fees, the lender scores 5 out of 5 for affordability.

Availability: 4.5/5

  • Loan products: PenFed just offers a HELOC product, but does not offer home equity loans
  • Footprint: PenFed is licensed to operate in all states and the District of Columbia. 
  • Credit score: PenFed requires a credit score of 680 or above to qualify for a home equity line of credit — about average for home equity lenders.
  • Loan minimum: $25,000, which is slightly on the high side.
  • Draw requirement: None, except for properties in Texas, where there’s a minimum draw requirement of $4,000. 

PenFed’s nationwide footprint results in a 4.5 out of 5 for availability, the score dampened a bit by only one product and the $25,000 loan minimum. 

Borrower experience: 4/5

  • Rate transparency: For an exact rate estimate, consumers must fill out an online form or call the company to provide information. The company provides some information in terms of lowest-available rate, but an additional margin on the variable APR is not clearly outlined.
  • Convenience: In-branch service is limited to only a small number of states. There is a full array of online banking options.
  • Customer service: Support is available Monday-Saturday, including evening hours during the week by phone, email, and online chat.
  • Fixed-rate options: PenFed offers a fixed-rate HELOC conversion option, allowing borrowers the flexibility to switch several times over the life of their loan at no charge — the latter a nice perk. 

Due to the limited branch locations and rate opacity, the borrower experience score dips to 4 out of 5.

PenFed Credit Union’s reputation

With a focus on service to public employees, the company has a trustworthy reputation.

PenFed retains a 4+-star rating on TrustPilot, where many consumers commend their swift rate processing and approval processes. 

To date, fewer than 150 complaints have been filed in the Consumer Finance Protection Bureau (CFPB) database that are specific to PenFed’s HELOC product. By comparison, some similarly-sized national banks have tallied thousands of complaints for HELOCs specifically.

Home equity loan products offered

PenFed’s home equity lines of credit range from $25,000 to $500,000 and include a 10-year draw period followed by a 20-year repayment period. They are traditional, variable rate HELOCs, but they can be converted to a fixed-rate option, allowing you to lock some or all of your balance, with a minimum of $10,000 per fixed-rate advance. You can have three separate fixed-rate balances open at a time, with a maximum of two new advances per year. The repayment terms for these fixed-rate balances is 20 years.

How to qualify for a home equity loan with PenFed Credit Union

For a HELOC, PenFed requires a minimum credit score of 680 and a debt-to-income (DTI) ratio of no more than 50 percent. PenFed also requires proof of income, at least one year of W-2s, at least two months’ of your most recent bank account statements and a mortgage statement for all properties owned. You might also need to provide documentation for current debts and self-employment income. 

PenFed does require a combined loan-to-value (CLTV) ratio limit of 85 percent for loans on both primary and secondary residence; that figure is 80 percent for condominiums and for any property located in Texas.

Remember that you do need to be a member of the credit union to apply for a home equity line of credit.

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Bankrate insight

You can tap into your home equity — the difference between your home's worth and what you owe on your mortgage — with a home equity loan or a HELOC. With those funds, you can tackle a variety of expenses, like debt consolidation or home renovations. 

However, before you dive in, it's important to figure out your loan-to-value ratio (LTV). Lenders use your LTV to determine how much of your equity stake you can actually borrow. (It’s typically 80 percent, although some lenders allow you to access as much as 90 percent.) The amount of equity they’ll let you tap is one consideration when choosing a lender. Be it a retail bank, online lender or credit union, it may offer different home equity loan rates and terms, too. That’s why it’s important to shop around for the best deal.

How to apply with PenFed Credit Union

You can start the application process with PenFed online, including applying for membership. To become a member, you’ll need to open and maintain a $5 savings account with the credit union. You will have to close the HELOC over the phone or via e-notary, if your state allows it.

Alternatively, you can request a call from a loan officer. For any questions during the application process, you can call customer service at 800-970-7766, Monday through Friday from 7 a.m. to 11 p.m. ET, Saturday from 8 a.m. to 11 p.m. ET or Sunday from 9 a.m. to 5:30 p.m. ET, or send a secure message online.

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Loan amount

$25,000 to $500,000

$25,000-$1,000,000

Up to $400,000 (up to $100,000 in some states)

Min. credit score required

680

700

640

Repayment terms

10-year draw period and 20-year repayment period

10-year draw period and 20-year repayment term for HELOC (5-year to 20-year repayment term for fixed-rate HELOC); 5 years to 20 years for home equity loan

Standard credit card repayment (at least 1% of the statement balance plus interest); with cash-outs, you can lock in payments for 5-10 years

Funds available in

15 days

Undisclosed

With 7 business days

Recent customer review

Customer review

Rating: 0 stars out of 5

No reviews available yet.

N/A

The absolute worst HELOC underwriting ever!

Rating: 1 stars out of 5

Hello- I have been in underwriting for five weeks. I'm 62, I've been through about 15 mortgage applications. I can assure you that they don't have a clue what they are doing. ...

Jim .

Low offer and extremely high rates and fees

Rating: 1 stars out of 5

They offered me a very low amount compared to other lenders and on top of that offered a rate of 9.99% plus 4.5% cash out ( this cash out is a scam because it is an origination fee...

Heloc

Pentagon Federal Credit Union customer ratings and reviews

NMLS: 401822

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