$50,000 home equity loan vs. $50,000 HELOC: Here's which costs less per month now
Summary
Homeowners have a lot of home equity they can borrow against today. Comparing a $50,000 home equity loan and a $50,000 home equity line of credit (HELOC) shows that loans currently have slightly lower monthly payments, but HELOC rates may drop and become cheaper over time.Key Facts
- Homeowners can borrow against record-high home equity amounts.
- HELOC interest rates have dropped by over 2 percentage points in the last 18 months.
- A $50,000 home equity loan at about 6.96% interest costs approximately $579 per month for 10 years.
- A $50,000 HELOC at about 7.11% interest costs roughly $583 per month for 10 years.
- Both home equity loans and HELOCs are cheaper now than in 2025 when rates were higher.
- HELOCs have variable rates that can go up or down, affecting future monthly payments.
- Home equity loans have fixed rates, so payments stay the same unless refinanced.
- Borrowers should consider long-term affordability and shop around for the best rates before choosing either option.
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