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Banks are pitching home-equity lines of credit as a cheaper form of borrowing as Federal Reserve rate cuts could lower HELOC rates to the mid-6% range, according to one estimate
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An increasing number of homeowners are tapping the equity in their homes for cash, but not to finance a new kitchen. Instead, they’re turning their house into a piggy bank, sometimes to get their credit-card debt under control.
It’s a sluggish moment for homeowners who are trying to sell but a brisk one for those who want to tap into their home equity. After waning in popularity for about a decade, more consumers started turning to HELOCs around 2022, as home values surged. And if the Federal Reserve cuts interest rates this year, it could help broaden the appeal of these credit lines even more.
