The average homeowner has a sizable amount of equity to borrow from right now. Nitat Termmee/Getty Images

Home equity loan interest rates just hit their lowest point in 2025.

That was the big takeaway in the home equity market this week after average rates on home equity loans declined again, this time to just 8.22%, according to Bankrate data. That followed earlier drops this summer that have now put home equity loans on par with home equity lines of credit (HELOCs) as two of the cheaper ways to borrow money right now.

Still, a low interest rate shouldn't be the only motivation for borrowing, particularly when pursuing a home equity loan which uses your home as collateral in these exchanges. Failure to repay could ultimately lead to foreclosure on the property . So,

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