Home Equity and HELOC Rates - October 2026 Average Rates and Trends
Independent rate roundup with current survey averages, credit-score impact analysis, and rate forecast. Unlike bank pages that show you their rates, this page shows you the market.
Current Rate Summary (October 2026)
Average HELOC Rate
7.34%
Variable
Average HE Loan Rate
8.63%
Fixed, 5-year
Prime Rate
7.00%
Fed funds + 3%
HELOC Margin Range
Prime to +3.5%
Above prime
Source: Bankrate national survey averages, 14 October 2026 ($30,000 line or loan, 700 FICO, 80% CLTV). Prime rate: U.S. Bank and other major banks, effective 17 September 2026. Updated monthly.
Where Rates Stand (October 2026)
Bankrate's national survey put the average HELOC rate at 7.34% and the average 5-year home equity loan rate at 8.63% as of 14 October 2026. Both figures assume $30,000 borrowed by a borrower with a 700 credit score at 80% combined loan-to-value.
HELOCs move directly with the prime rate, which rose from 6.75% to 7.00% on 17 September 2026 after the Federal Reserve raised the federal funds target to 3.75% to 4.00% (FOMC statement, 16 September 2026). Fixed home equity loan rates track longer-term Treasury yields and currently sit about 1.3 percentage points above the variable HELOC average.
The September hike was the Fed's first increase since 2023 and the first move in the prime rate since December 2025, when it fell to 6.75%. The direction of travel is now up, not down.
How Rates Are Set
HELOC Rates (Variable)
HELOC rates are based on the prime rate plus or minus a margin set by the lender. The prime rate currently sits at 7.00% and moves in lockstep with the Federal Reserve's federal funds target. When the Fed cuts rates, HELOC rates fall. When the Fed raises rates, HELOCs get more expensive.
HE Loan Rates (Fixed)
Home equity loan rates are based on the 10-year Treasury yield plus a risk premium. They do not move as directly with the Fed as HELOC rates. Fixed rates are typically slightly higher than variable because the lender absorbs the risk of future rate changes.
Rate Tiers by Credit Score
Your credit score is the single biggest factor in the rate you pay. These are approximate HELOC rate ranges based on the current prime rate of 7.00%.
| Credit Score | Margin | Typical Rate | Status |
|---|---|---|---|
| 780+ | Prime to Prime + 0.25% | 7.00% - 7.25% | Excellent |
| 720-779 | Prime + 0.25% to Prime + 0.75% | 7.25% - 7.75% | Very Good |
| 680-719 | Prime + 0.75% to Prime + 2% | 7.75% - 9.00% | Good |
| 640-679 | Prime + 2% to Prime + 3.25% | 9.00% - 10.25% | Fair |
| 620-639 | Prime + 3.25% to Prime + 3.75% | 10.25% - 10.75% | Minimum |
Rate Forecast: What to Expect in 2026
HELOC rates eased from their 2023-2024 peak as the Fed cut the federal funds target to 3.50% to 3.75%, where it held through the first half of 2026 with the prime rate at 6.75%.
On 16 September 2026 the Fed raised the target by a quarter point to 3.75% to 4.00%, stating that inflation remains elevated and that the move would support a timelier return to its 2 percent goal. The prime rate rose to 7.00% the next day, and every prime-linked HELOC rose with it.
Bottom line: If you are considering tapping your equity, fixed home equity loan rates above 8.5% remain well above the prime-linked HELOC average, but a HELOC carries the risk that the Fed raises again. Waiting for Fed cuts is a gamble the central bank's latest decision does not support.
Frequently Asked Questions
What is the average HELOC rate right now?
As of 14 October 2026, the average HELOC rate is 7.34% (variable), per Bankrate's national survey. It is built from the prime rate (7.00% since 17 September 2026) plus a margin that depends on the lender and your credit profile. Rates range from near prime for excellent credit to 10%+ for lower scores.
What is the average home equity loan rate?
The average home equity loan rate is 8.63% (fixed, 5-year term) as of 14 October 2026, per Bankrate's national survey. That is about 1.3 percentage points above the HELOC average, because the fixed rate shifts the risk of future rate moves from the borrower to the lender.
How are HELOC rates determined?
HELOC rates are based on the prime rate (currently 7.00%) plus or minus a margin set by the lender. Your margin depends on your credit score, LTV ratio, loan amount, and the lender's current pricing. The Fed's rate decisions directly affect HELOC rates since the prime rate moves in lockstep with the federal funds target.
Will HELOC rates go down in 2026?
Not on current guidance. On 16 September 2026 the Fed raised the federal funds target by a quarter point to 3.75% to 4.00%, its first increase since 2023, saying inflation remains elevated. Banks lifted the prime rate from 6.75% to 7.00% the next day, so variable HELOC rates went up, not down. A HELOC rate cut would need the Fed to reverse course.
Does my credit score affect my HELOC rate?
Significantly. A borrower with 780+ credit might pay close to prime (around 7.00-7.25%), while a borrower with 640 credit might pay prime plus 3.5% (around 10.50%). A gap of roughly 3.5 percentage points on a $75,000 HELOC means about $220/month more in interest.
How do home equity loan rates compare to mortgage rates?
Home equity loan rates are typically 1-2% higher than first mortgage rates because they are subordinate liens. If you default, the first mortgage gets paid first, making the second lien riskier for the lender.
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