What are the HELOC rates in Massachusetts?

By Citizens Staff

If you're considering taking out a home equity line of credit (HELOC) in Massachusetts, you should know the factors that are considered when determining its annual percentage rate (APR). Your credit profile, line of credit amount, lien position and the combined loan-to-value (LTV) are all taken into account when lenders calculate a borrower's HELOC rate. Let's break down these factors to help you strengthen your financial foundation and potentially improve your eligibility.

Build a strong financial foundation

To qualify for a HELOC in Massachusetts, lenders typically look for:

• A credit score of 680 or higher: While some HELOC lenders may approve scores as low as 620, a higher score can significantly reduce your interest rate.
• At least 20% equity in your home: An example of this would be if your home is valued at $500,000, you should owe no more than $400,000 on your mortgage to meet this threshold. That's not to say you won't be approved for a HELOC if you have less equity in your home, though. Citizens allows for a combined LTV of up to 85% for eligible borrowers.

Other factors like the size of the line of credit and if you have an existing lien on your house will affect the HELOC rate as well. Generally, the more equity you have and the stronger your credit, the better your HELOC rate will be.

Steps to improve your HELOC eligibility

Before applying for a HELOC, you could consider taking these steps to be proactive in improving your eligibility:

• Reduce revolving debt: Paying down credit cards can improve your credit utilization ratio, a key component of your credit score. It can also help lower your debt-to-income (DTI) ratio, which lenders take into account when approving borrowers.
• Avoid new credit inquiries: Applying for new credit lines before you put in your HELOC application can temporarily lower your score.

Shop smart: compare HELOC offers

HELOC Rates and terms can vary widely between lenders. For example, while Citizens doesn't charge application fees or closing costs, some lenders require you to pay 2%-5% of the loan amount. To ensure you're getting the best deal, you should:

• Compare local banks, credit unions and online lenders.
• Ensure there's no commitment or impact to your credit score before reviewing an offer.
• In addition to interest rates, read the fine print to understand any hidden fees or unfavorable terms.

The HELOC application and closing process can vary from lender to lender. Some can take up to six weeks to process a loan whereas with Citizens, you can apply in minutes and could be ready to close in as few as seven days.

Securing the most competitive HELOC rates

When applying for a HELOC, you want to make sure you set yourself up for success by building a strong financial foundation with a credit score of 680 or higher, and that you have at least 20% equity in your home. If you have questions, we've got the answers. Check out our FAQ below or check your HELOC rate with no impact to your credit score.

HELOC FAQs

Can I get a HELOC in Massachusetts?

Yes! Most national and regional lenders offer HELOCs in Massachusetts. While each lender has its own criteria, you'll generally need:

• A maximum LTV ratio of 85%
• A credit score of at least 680 (some lenders approve scores as low as 620)
• A DTI ratio below 65%

Some lenders may have more flexible or stricter requirements, so it's worth comparing multiple options.

What's the lowest HELOC rate available in Massachusetts?

Rates vary based on your creditworthiness, equity and the lender's terms. The best way to find the lowest rate is to compare personalized offers from several institutions, without impacting your credit score.

How can I determine the HELOC amount I could qualify for?

Use this HELOC calculator to determine the HELOC amount you may qualify for.

Get your HELOC rate with no impact to your credit score.

It only takes a few minutes to get an accurate personalized HELOC offer before you apply.

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