Home Equity Lines of Credit (HELOCs)

Home Equity Lines of Credit (HELOCs) are experiencing a resurgence due to both homeowners having trillions in tappable equity as well as many being locked into low-rate mortgages. Borrowers are seeking liquidity without refinancing. Banks and independent mortgage lenders are responding to this by expanding HELOC products, increasing limits, and embracing new technology and digitization. Current areas of focusing include securitizations gaining momentum, rising fraud threats, and intensifying competition is intensifying. HELOCs have re-emerged as a strategic growth lever for mortgage professionals.

Secondary markets

HELOC, nonagency securitization could grow long term, leaders say

Though home mortgage issuance has slumped in line with originations, new potential bank capital rules and increased consumer debt consolidation could boost activity for these two subsets in the secondary market.

By Bonnie Sinnock and Brad Finkelstein

October 23
Home equity loans

Ballooning interest rates make tapping equity harder for borrowers

Homeowners have over $29.3 trillion in combined home equity, yet accessing it is becoming less attractive, Point's report said.

By Maria Volkova
Reporter

October 5
Housing markets

Homeowners want to use cash, not credit, to pay for renovations, survey finds

High mortgage rates and little inventory explain why over 60% of homeowners did or will perform a repair project in the next year, a LendingTree survey found.

By Brad Finkelstein
Originations Editor

September 13
Home equity loans

Mortgage originations fall to a new low in 2023: TransUnion

Volumes dropped below 900,000 in the first three months this year, while the cumulative loan balance nationwide also declined on a quarterly basis for the first time since 2015.

By Spencer Lee
Technology Reporter

August 10
Mortgage technology

Figure adds four nonbanks to HELOC partnership program

The newest participants in the blockchain-focused lender's private-label lending business are CMG Financial, CrossCountry Mortgage, Fairway Independent Mortgage and The Loan Store.

By Brad Finkelstein
Originations Editor

July 12
MBS

J.P. Morgan Mortgage Trust prepares to issue $186.3 million in HELOC-backed notes

Notes will be repaid through a modified sequential structure, which calls for the A-1 and M-1 through M-3 classes to receive principal on a pro-rata basis.

By Donna M. Mitchell
Editor

June 22
RMBS

Ocwen's inaugural reverse mortgage RMBS sets out to raise $264.9 million

Among the nonperforming assets 44.01% are either in foreclosure or referred for foreclosure; 19.32% are in default; 7.17% are liquidated and 1.75% are in bankruptcy.

By Donna M. Mitchell
Editor

June 15

Banks on deck for quarterly earnings amid tariffs mayhem: Live coverage

The first three months of the year coincide with the start of President Donald Trump's second term in office. Investors are likely to be more interested in banks' outlooks amid swings in tariff policy than the first-quarter results.

Live Updates

Resources

The latest American Banker research and discussion on Tariffs

Frequently Asked Questions:

What is driving the increased demand for HELOCs in 2025?

Homeowners want to access equity without sacrificing their existing rates due to mortgage rates remaining elevated. This scenario has increased demand for HELOCs, rebounding to pre-2008 levels. Lenders like Achieve Home Loans securitizing $210.9 million in HELOCs to meet funding needs.

How are banks and other institutions competing in the HELOC space?

Banks have traditionally offered advantages related to portfolio and pricing, while independent mortgage banks offer speed, flexibility, and digital access. Banks vs IMBs: who wins the HELOC war explores how originators are differentiating and how quickly dynamics are shifting.

What are the main fraud risks that HELOC lenders are currently facing?

As HELOC originations become more digital, new vulnerabilities are emerging. Consumers are increasingly at risk of fraud from identity theft, fake occupancy claims, and elder-targeted scam.

What does a real-world HELOC fraud scam look like?

As more lenders enter the second lien market, a scam involving an identity thief who stole $2 million through HELOC fraud highlights the necessity of stricter borrower verification and title controls.

In what ways is the mortgage industry updating HELOC closings and documentation?

The Mortgage Industry guidelines Maintenance Organization (MISMO) released eHELOC SMART Doc standards to make digital closings more similar across systems and investors and to make things go more smoothly.

How is the secondary market responding to rising HELOC volumes?

Investor interest is increasing with HELOC deals now drawing institutional capital at scale, especially among those using emerging technology. Figure’s AAA-rated HELOC securitization’s blockchain-based home-equity line of credit securitization was the first of to receive a AAA rating from a major rating agency.