• Home equity line of credit

Flexible & fast HELOC funding options

  • Flexible line of credit, draw as needed*
  • Up to $500,000,* use for any purpose***
  • Only pay interest on what you use2
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  • Home equity loan

Fixed-rate home equity loans

  • Fixed rate, fixed monthly payments6
  • Funding in one lump sum
  • Up to $249k* use for any purpose***
Get my HELoan rate
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  • Explore your options

HELOCs vs. HELoans: what’s the difference?

We break down the differences between home equity loans and lines of credit so you can compare your home equity options side by side.
Compare HELOC & HELoan
Home equity resources

Home equity line of credit (HELOC)

Flexible line of credit, draw as needed for up to $500k,* only pay interest on what you use.2

Learn more

Home equity loan (HELoan)

Fixed-rate loan with steady monthly payments, funded in one lump sum for up to $249k.*

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Compare HELOC & HELoan

Turn your home equity into cash—fast

  • Get your personalized rate in minutes with no impact to your credit score
  • Quick and easy online application—we’re here to support you every step of the way
  • Access your funds in as few as 11 days**
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Comparing home equity options

Lines & loans, side by side HELOC HELoan
Keep your existing mortgage icon of teal circle with check mark inside indicating yes icon of teal circle with check mark inside indicating yes
Use funds for any purpose*** icon of teal circle with check mark inside indicating yes icon of teal circle with check mark inside indicating yes
Interest rate Variable APR Fixed APR
Monthly payments Flexible4,5 Steady6
No prepayment penalty icon of teal circle with check mark inside indicating yes icon of teal circle with check mark inside indicating yes
Funding in as few as 11 days** icon of teal circle with check mark inside indicating yes icon of teal circle with check mark inside indicating yes
Funding in one lump sum icon of grey circle with an X cross mark inside indicating no icon of teal circle with check mark inside indicating yes
Draw funds as you need them* icon of teal circle with check mark inside indicating yes icon of grey circle with an X cross mark inside indicating no
Interest-only payment options2 icon of teal circle with check mark inside indicating yes icon of grey circle with an X cross mark inside indicating no
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Explore your home equity options

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Home equity line of credit (HELOC)

A HELOC is a flexible line of credit that uses your home equity to access up to $500,000* at a low, variable rate. It functions like a credit card in that you can draw funds, as needed,* up to a limit based on your home's equity.3
Check mark Flexibility in usage & payments
Check mark Flexibility in usage
Check mark Flexibility in payments
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Home equity loan (HELoan)

A HELoan functions like a mortgage with a loan amount based on your home's equity. With one-time funding, a fixed rate and a steady repayment schedule, there's no temptation to outspend your budget.
Check mark One-time funding
Check mark Steady payments
Check mark One-time funding · Steady payments

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How much home equity can you tap into?

My property in is worth  and has an est. mortgage balance of , which gives me an est. $115,000 of home equity to tap into.
Let’s give your home equity more time to grow—you’ll need $25,000+ in home equity to be eligible. In the meantime, a personal loan could be an option. Get my personal loan rate.
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Home equity resources

See more home equity content
Blog · 6min read

Home equity loans vs. lines of credit

Using the equity in your home to pay for substantial renovations on your property or consolidate...
Read more
Blog · 4min read

What’s home equity? Everthing you need to know

Being a homeowner can offer many benefits, including the ability to build home equity. But exactly...
Read more
Blog · 5min read

How to use your home equity

Ever since making your very first mortgage payment years ago, you’ve been slowly building up...
Read more

Common home equity questions

Visit the Prosper Help Center for more answered questions

Home equity is the difference in how much your house is worth and the balance of your mortgage and other liens.

Home equity is calculated by determining your home’s fair market value, then subtracting the amount you still owe on your mortgage (and on any other loans or liens that are tied to your home). Whatever is left is your home equity. Fair market value is the price your home would sell for in an open and competitive market. You can use an online home appraisal and a competitive market analysis to estimate your own home’s value. When you apply for a home equity line of credit or home equity loan, your lender will generate their own appraisal using an independent third-party appraiser or valuation tool.

You can use your home’s equity to access an exclusive set of financing options, which include HELOCs and HELoans.

HELOCs and HELoans use the equity in your home as collateral to access larger amounts of money at lower interest rates. Many people use home equity lines of credit and home equity loans to further grow the equity in their home by completing home improvements, renovations, and additions. In other words, by using home equity products to complete work on your house that can increase its fair market value, you may effectively grow your home’s equity while you leverage it to access capital at low rates.

Home equity is calculated by subtracting the total amount you owe on your mortgage from your home’s “fair market value”.

If you own your home outright, then its entire fair market value would count towards your equity. Fair market value is the price your home would sell for in an open and competitive market. You can use an online home appraisal and a competitive market analysis to estimate your own home’s value. When you apply for a home equity line of credit or home equity loan, your lender will generate its own appraisal.

A HELOC is a credit line that typically has a variable APR, and a HELoan is a term loan that typically comes with a fixed APR.

HELOCs and HELoans are secured by your house, which allows borrowers to access larger sums of money at lower rates. A home equity loan is a bit like a second mortgage: it’s a one-time loan that you’ll start repaying immediately through fixed monthly payments. On the other hand, a home equity line of credit lets you borrow when you need to instead of all at once. Ultimately, a home equity loan is more rigidly structured while a HELOC is more flexible.

To figure out how much equity you have in your home, you’ll need to determine how much your house is worth in the current market and subtract however much you still owe on your mortgage.

The difference between these two numbers is your home equity. You can calculate how much home equity you have in just a few seconds by using Prosper’s Home Equity Calculator.

In some cases you can use your home’s equity to access financing products, such as HELOCs or HELoans, that can be used to consolidate debts***.

Because you use your home as collateral for HELOCs and HELoans, you can often borrow funds at a lower interest rate than through personal loans or credit cards. This can lead to major savings and can be a great way to pay off debt.

     You should speak to a tax professional regarding the tax benefits of HELOCs and HELoans.

It is possible for your home’s value to go down, which could affect its assessed “fair market value” and your resulting home equity calculations.

While real estate usually increases in value over time, it is always possible that market volatility or local alterations could impact the size of your home equity.

Home equity itself does not affect your credit score.

Borrowing against your home equity could affect your credit score in a negative or a positive way, depending on whether you make timely monthly payments. But remember, checking your rate for a home equity product like a HELOC or HELoan through Prosper does not affect your credit score at all.

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Answers to home equity questions, from your application to payments.
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*Eligibility for a home equity loan or HELOC up to the maximum amount shown depends on the information provided in the home equity application. Depending on the lender, loans above $250,000 may require an in-home appraisal and title insurance. Depending on the lender, HELOC borrowers must take an initial draw of $50,000 at closing; subsequent HELOC draws are prohibited during the first 90 days following closing; after the first 90 days following closing, subsequent HELOC draws must be $1,000, or more, except in Texas, where the minimum subsequent draw amount is $4,000.

**The amount of time it takes to get funds varies. It is measured from the time the lender receives all documents requested from the applicant and depends on the time it takes to verify information provided in the application. The time period calculation to get funds is based on the first 4 months of 2023 loan fundings, assumes the funds are wired, excludes weekends, and excludes the government-mandated disclosure waiting period.
***For Texas home equity products through Prosper, funds cannot be used to pay (in part or in full) non-homestead debt at account opening.
1HELOCs through Prosper have a variable interest rate. The APR may change and will be based on an index plus a margin. The “Index Rate” will based on The Wall Street Journal Prime Rate (“Prime”) published on the last business day of the month, (8.500% as of 07/31/2023). No annual fee for the first year, then $50 per year thereafter during the Draw Period. During the term of the HELOC, the APR will not go below 2.50% and will not exceed 21% or the maximum APR allowed by applicable law, whichever is less. Property insurance required. Flood insurance may be required. No annual fee for the first year, then $50 per year thereafter during the draw period. Obtaining the best rate requires the following criteria to be met: 1) a new home equity line of credit application, 2) a line amount between $200,000 and $400,000, 3) line must be in first lien position, 4) having a consumer checking account with the lender, or in the states listed below, any checking account, set up with automatic monthly payment deduction at the time of origination, 5) a loan-to-value (LTV) of 80% or less, and 6) strong creditworthiness. In the following states you can get the discount by setting up automatic payments with any checking account: AL, AR, DC, FL, GA, IA, IL, IN, KY, MD, ME, MN, NC, NE, OK, SC, SD, TN, and VA.
2HELOCs through Prosper have a 10-year draw period, followed by a repayment period. During the draw and repayment periods, the borrower is required to make minimum monthly payments. During the draw period, you may choose to make interest-only monthly payments. Interest-only payments may be lower and allow you flexibility in repaying the principal during the draw period. During the repayment period, you will be required to make monthly payments of both interest and principal. Payments during the repayment period may be higher than interest-only payments during the draw period. Refer to your HELOC agreement for details on monthly minimum payments and payment calculations.
3Depending on the lender, qualified home equity applicants may borrow up to 80% – 95% of their primary home’s value and up to 80% – 90% of the value of a second home. In Texas, qualified applicants may borrow up to 80% of their home’s value. HELoan applicants may borrow up to 85% of the value of an investment property (not available for HELOCs).
4Total costs, fees or charges of $1,712 – $8,902 may apply. During the term of the HELOC, the APR will not exceed 18% or the maximum APR allowed by applicable law, whichever is less. Property insurance required. Flood insurance may be required.
5No annual fee for the first year, then $50 per year thereafter during the draw period. During the term of the HELOC, the APR will not exceed 21% or the maximum APR allowed by applicable law, whichever is less. Property insurance required. Flood insurance may be required.
6For example, a thirty-year $60,000 HELoan could have an interest rate of 8.624% and additional costs, fees or charges up to $3,322 for an annual percentage rate (APR) of 8.862%. You could receive $57,613 and make 360 scheduled monthly payments of $476.83.
Home equity products through Prosper may not be available in all states.
All home equity products are underwritten and issued by Prosper’s Lending Partners. Please see your agreement for details.

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