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.

Blockchain

Mike Cagney's new firm says it's giving banks 'a compelling reason' to use blockchain

The SoFi co-founder said Figure Technologies is working with national banks to employ its distributed ledger tech for loan originations.

By Will Hernandez

December 13
Fintech

HELOC alternative Hometap raises $100M in new capital

Hometap, a fintech company providing an alternative to traditional home equity lending, secured $100 million in new financing as it looks to expand its geographic reach.

By Brad Finkelstein

December 11
Refinance

Borrowers take most cash-out from properties in nearly 12 years

More than half of the third quarter refinance activity was the cash-out variety, with borrowers removing the most total equity from their homes in nearly 12 years, according to Black Knight.

By Brad Finkelstein

December 9
Consumer lending

Household debt hits new high as low rates boost mortgage demand

Home loan originations rose by double digits in the third quarter while auto loan originations approached an all-time high, according to new household credit data from the New York Fed.

By Laura Alix

November 13
Marketplace lending

BBVA, Prosper partner on digital home equity lines of credit

Prosper hopes to do for lines of credit what it did for unsecured personal loans, while BBVA hopes to provide a better experience for customers.

By Penny Crosman

November 4
HELOCs

Burned in 2008, Americans are refusing to tap their home equity

The once-popular loan Americans use to finance home renovations and college tuition is slowly dying, slashing a lucrative source of revenue for the nation's largest banks.

October 28
Earnings

Bank of America shifts away from home equity as first mortgages surge

Bank of America's total first-mortgage originations rose while its home equity production decreased in the third quarter.

By Bonnie Sinnock

October 16

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

Multimedia

Resources

The latest American Banker research and discussion on Tariffs

Digital Mortgage 2025

September 23
Daniel Leal

September 23
Monetary policy

Federal Reserve

Interest rates
Fed's Powell mum on future interest rate cuts

By Maria Volkova

September 23

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.