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If you’re looking for an inexpensive way to borrow a large amount of money right now, home equity is probably the best way to do it.
Not only do home equity loans And Home Equity Lines of Credit (HELOC) have lower interest rate than many popular alternatives, but they also come with a significant amount of money to use. Currently, the average homeowner owns approximately $330,000 in equity in your home. Keeping a 20% buffer, as most lenders prefer, this equates, on average, to hundreds of thousands of dollars of equity to use now. Depending on your financial situation, you may have more.
And with an average home equity loan rate now at 8.35%, this type of borrowing is almost three times cheaper than credit cards and many points lower than personal loans. But there are ways to get an even cheaper home equity loan rate in November. Below, we’ll break down three of them.
Find out what home equity loan rate you currently qualify for here.
How to Get a Low Home Equity Loan Rate in November
Want to get the lowest home equity loan rate possible this November? Then make sure you do all of the following:
Boost your credit score
This may seem obvious, but some borrowers will apply for a loan before ensuring that their credit is in perfect condition. Don’t do the same error. After all, the rates you tend to see listed on lender websites are aimed at borrowers with the highest credit scores and cleanest track records. If you don’t have both, expect to be offered a higher-than-average home equity loan rate. So, to get started, raise your score as high as possible now, even if it means having to delay your application slightly.
Explore your current home equity loan options online now.
Shop for lenders
Did you know that you don’t need to automatically use your current mortgage lender to borrow against your home equity? You can also use other banks and institutions. And these competitors can offer lower prices and better terms. But you won’t know which is which until you start researching lenders. However, don’t just look at the rate, as a lower rate could potentially hide excessive fees and penalties. So be sure to calculate all potential scenarios to ensure the lower rate isn’t canceled out by other fees.
Monitor specific dates
November will be loaded with important economic developments, the first being the October unemployment report, released on November 1st. This will be followed by the next Federal Reserve meeting (and likely a rate cut) on November 6-7 and the next Federal Reserve meeting (and likely a rate cut) on November 6-7 . next inflation figure, scheduled for publication on November 13.
These three elements can and likely will influence the rates that lenders offer home equity loan borrowers, potentially to a significant extent. So monitor them closely for opportunities to secure a lower than average rate. Keep in mind that home equity loan rates change daily, so they may adjust on one or more of these dates in November.
The essentials
While conventional ways to get a low home equity loan rate still apply in November — like improving your credit score and researching lenders — the month will also provide timely opportunities for borrowers to take action. With new unemployment and inflation data coming out later this month and the Fed’s first meeting scheduled after the rate cut in September, prepared homeowners will have plenty of opportunities to secure a low interest rate in the during the month – if they start acting now.
Learn more about your best home equity loan options here.
