Home equity loans and HELOCs

Home equity loans and lines of credit are playing a growing role in the mortgage industry as borrowers look to tap into rising home values amid high interest rates. These products introduce new considerations that can impact lending strategies, portfolio performance, and risk management for financial institutions. As a mortgage professional, it's critical to understand how evolving consumer behavior, the rate environment and broader economic conditions are shaping demand for home equity products. Explore our in-depth coverage, including news, expert analysis, and market research, to stay informed on the latest developments and insights around home equity lending.

Foreclosures

Texas home equity loan foreclosures could become easier

Twenty years ago, Texas became the last state in the union to legalize the home equity loan, allowing people for the first time to use their own homes as collateral.

By Lydia DePillis

August 8
Loan Think State regulators have their eye on reverse mortgage lenders

The U.S. population is aging, and one of the well-established components of the American dream — buying and owning a home — appears poised to aid in the baby boomers' next phase of life.

July 26

Melissa Klimkiewicz

Buckley Sandler LLP
Earnings

That was no typo: B of A held onto 90% of 2Q mortgage originations

It’s a very large number for any bank, but Bank of America executives said the move makes good economic sense and promotes relationship-building with customers.

By Brad Finkelstein

July 21
ATR

Consumers show ability to absorb a single rate hike

Borrowers with variable-rate debt affected by Federal Reserve rate hikes showed they could handle December's 25-basis-point increase, but that could be changing as short-term rates continue to rise.

By Bonnie Sinnock

July 20
Regulatory relief

CFPB's HMDA reg relief gets mixed response from CUs

Some credit union advocates are praising the Consumer Financial Protection Bureau for a move that exempts select institutions from certain reporting requirements, but other say the bureau must still do more.

By Aaron Passman

July 11
Real estate

Underwater borrower count falls below 2 million: Black Knight

The number of borrowers underwater on their mortgages is below 2 million for the first time since 2006, as rising home prices are improving homeowner equity and creating new lending opportunities.

By Elina Tarkazikis

July 10
Appraisals

LendingTree site shows consumers available home equity

LendingTree has added property valuation data to its My LendingTree site, showing consumers how much equity in their home they can tap.

By Brad Finkelstein

June 14

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

Johnson urges Senate to minimize changes to $40K SALT deal

By Skylar Woodhouse and Jennifer A. Dlouhy

June 10
Better taps Leah Price to head Tinman's growth efforts

By Maria Volkova

June 10
Alex Walters

June 10

Frequently Asked Questions:

What proactive measures are banks using to mitigate the impact of tariffs?

Trade finance services and corporate client advisory on supply chain adjustments allow banks to lessen the impact of tariffs. For example, Citizens Financial’s trade finance unit helped companies accelerate inventory purchases and use letters of credit to secure transactions ahead of new duties. Many banks are also using hedging strategies and leveraging deregulation windfalls to address higher costs.

How should banks recalibrate interest rate forecasting and monetary policy expectations amid tariff-induced economic disruptions?

Banks can incorporate tariff-driven inflation and growth scenarios into their interest rate models and maintain flexibility in policy outlooks. Institutions are closely tracking Federal Reserve signals in this volatile trade environment, as tariffs can both slow growth and raise prices. This can put the Fed “in a quandary,” requiring banks to update their asset-liability strategies to account for potential rate cuts or even hikes.

What advanced compliance and technology strategies are banks using to optimize cross-border payments and trade finance?

Banks are deploying sophisticated payment analytics and real-time treasury tools to manage cross-border flows amid shifting tariffs. BNY Mellon, for example, notes clients are using predictive cash-flow analytics to navigate uncertainty. Institutions can also improve compliance automation by integrating systems for instant sanctions/tariff list updates. This can ensure cross-border transactions meet changing trade rules.

What are best practices in risk modeling and scenario analysis for banks to navigate tariff-related risks?

Leading banks can look to bolster scenario analysis capabilities to account for tariff shocks. Banks can run stress tests on portfolios with heavy exposure to tariff-impacted sectors such as automotive manufacturing and agriculture as well as model multiple trade war outcomes. Analysts also advise enhancing “playbooks” for varied economic scenarios and properly pricing new loans for added risk. For example, this could mean using forward-looking models to adjust credit loss provisions and capital plans.

How can banks prepare for long-term industry trends driven by tariffs and trade uncertainty?

Banks can prepare through incorporating trade policy shifts into growth investments as well as technology investments. This includes diversifying supply chain financing, investing in local manufacturing projects, and strengthening presence in resilient markets. Industry leaders like JPMorgan’s Jamie Dimon are watching the “restructuring of trade and tariffs” as an inflationary force shaping future strategy.

Which banking operational units should banks prioritize for tariff exposure assessments?

Commercial lending divisions, including those that finance manufacturers, agriculture, and exporters are a priority. These units will most directly face clients impacted by tariffs. Other units to review exposure risks include specialized trade finance and supply chain finance.

How is artificial intelligence (AI) helping banks address tariff-related challenges?

AI enables banks to respond faster and more efficiently to tariffs. Machine learning models can recalibrate pricing and supply chain finance strategies as trade policies shift. Generative AI tools can shorten the time needed to update payment systems for new tariff rules update payment systems for new tariff rules. AI-enabled platforms can make compliance a proactive function by automating real-time screening of transactions against changing trade restrictions.