What's a good home equity loan interest rate now that the Fed's cutting rates again?

Home equity loan rates may fall further as the Federal Reserve continues it's rate-cutting campaign. sommart/Getty Images

It's rare to have a robust borrowing source and a low interest rate to utilize at the same time.

But that's exactly what home equity borrowers have been accustomed to in recent years. Home equity levels reached a record high heading into the third quarter of 2025, according to a recent report. Currently, the average homeowner has around $300,000 worth of equity to borrow from.

At the same time, home equity loan rates are cheaper than what can typically be secured with a credit card or personal loan. And they're positioned to become even more affordable now that the Federal Reserve has resumed the interest-rate cut campaign it started in 2024. With