Mortgage holders in the U.S. have $11.7 trillion in tappable equity, the portion they could borrow against while keeping their loan-to-value ratio at 80% or lower, according to the August 2026 Mortgage Monitor from Intercontinental Exchange (ICE), which measured it as of the second quarter.
Many are borrowing without touching their first mortgage. Second liens, meaning home equity loans and lines of credit, supplied 54% of all equity pulled out of homes in the first quarter of 2026, ICE’s June 8, 2026, release said.
The appeal is easy to see for anyone who holds a mortgage under 4%, a range where the math often says to keep the loan. A second loan adds borrowing power without replacing that rate.
The average home equity line of credit, or HELOC, carried a 6.6% rate in March 2026, ICE reported. What that means in monthly dollars depends on a detail most borrowers meet only in the paperwork.
Where the $275 comes from
Interest at 6.6% on $50,000 comes to $3,300 a year, or $275 a month. That matches the “roughly $275” ICE cited for a $50,000 line, and it covers interest only.
The Consumer Financial Protection Bureau’s HELOC booklet says some plans allow interest-only payments during the draw period, meaning you pay nothing toward the principal.
When the repayment period starts, payments can jump, and some plans end with a balloon payment, a large amount due all at once.
What can move the payment
HELOC rates are typically variable, built from an index plus a margin, and the U.S. prime rate is a common index, the CFPB says. That means payments can change even if the borrower draws no more money.
Prime moves with the Federal Reserve’s target range. The Fed raised that range by a quarter percentage point to 3.75% to 4% on Sept. 16, 2026, then left it unchanged on Oct. 28, though two officials voted for another increase.
On a $50,000 balance, each quarter-point move shifts an interest-only payment by about $10 a month.
ICE’s September report put HELOC rates in a 6.6% to 6.8% range, more than 3 percentage points below their 2023 peak, but that data predates the Fed’s increase. Compare any quote with the current prime rate rather than those averages.
Because the home is collateral, falling behind can put it at risk, the CFPB warns. Lenders can also freeze or cut a credit line if the home’s value falls or the borrower’s finances worsen.
Costs to settle before you compare lenders
Up-front costs vary by lender. The CFPB says some waive them, while others charge for appraisals, application fees that may be nonrefundable, and closing costs. Some lines add annual, inactivity or early termination fees.
Federal law generally gives borrowers until midnight of the third business day after the account opens to cancel in writing when their primary home secures the line, and the line generally must be repaid in full when the home sells.
Putting your own numbers on it
Cash tends to cover smaller jobs. In a LendingTree analysis of Census Bureau data, cash covered home improvement projects with a median cost of $1,902, while home equity loans financed projects with a median cost of $7,924.
If you want figures for your own home, you can use Quicken Loans' home equity calculator. It asks a few questions about the home, and once it matches you with lenders, it shows estimated rates and payments. Quicken Loans is a marketplace that connects homeowners with lending partners.
Set those estimates next to the $275 benchmark, then ask each lender what the payment becomes if the index rises a quarter point.
1 LMB Mortgage Services, Inc. d/b/a Quicken Loans; NMLS #167283; https://www.nmlsconsumeraccess.org/. Not a lender. Quicken Loans is a financial services marketplace that connects consumers with lending partners.
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