Home Equity
Looking to extend your budget? Perhaps you’re looking to fund some home remodeling, a major purchase, or debt consolidation. A home equity loan or line of credit (HELOC) lets you borrow against the equity in your home, often at lower rates than traditional personal loans or credit cards.
Choosing your home equity
Home Equity Loan
- As low as 6.613% APR1
- Loan amount is fixed and you receive the funds upfront
- Your rate and payments are fixed for the life of the loan
- Terms of 5, 10, or 15 years available
- Consider this option if you prefer a fixed loan amount, rate, and payments
Home Equity Line of Credit
- As low as 7.500% APR1
- A revolving credit line available as you need it
- No requirement to carry a balance
- Consider this option if you prefer flexibility with amount of credit you plan to use
Benefits
Financing available for up to 100% of the value of your owner occupied home, less your first mortgage
No closing costs for lending amounts of $15,000 or more
Generally offers greater lending amounts and lower rates than personal loans and credit cards
Current Rates
| Type | Rate | APR1 | EMP2 (per $1,000) |
|---|---|---|---|
| Home Equity Loans | |||
| 0-5 Years | 6.500% | 6.613% | $19.57 |
| 6-10 Years | 6.875% | 6.940% | $11.55 |
| 11-15 Years | 7.125% | 7.197% | $9.06 |
| Max Equity Loans | |||
| 5 Year | 7.875% | 8.014% | $20.22 |
| 10 Year | 8.125% | 8.203% | $12.20 |
| 15 Year | 8.500% | 8.560% | $9.85 |
| Endless Equity Line of Credit³ | |||
| New Equity Member⁴ | 7.500% | ||
| Refinanced | 8.000% | ||
| Max Equity Line of Credit⁵ | 9.250% |
2:EMP = Estimated Monthly Payment.
3:Endless equity line of credit is fixed for the first 24 months and then prime for life. Minimum APR is 8.000% and the maximum APR is 15.000%.
4:New Equity Promotion. Prime Rate minus 0.50% for 24 months then Prime Rate.
5:Max equity line of credit is fixed for the first 24 months and then prime plus 1.250%. Minimum APR is 9.250% and the maximum APR is 15.000%.
Make sure you’re protected
In order to get the most out of your home, you have make sure it’s adequately protected. We’re pleased to offer homeowners insurance through our subsidiary, WebFirst Insurance, LLC., for peace of mind from a team you trust.
WebFirst Insurance’s experienced agents will work with you to make sure you get the right coverage for your needs and budget. Selecting to cover both your auto insurance and homeowners insurance through WebFirst Insurance can deliver discounts of up to 20%.
Learn MoreHow can we help?
Our dedicated loan center team is happy to answer your questions or provide assistance with completing an online application.
(774) 823-1665
Monday – Wednesday: 8:00 a.m. – 4:30 p.m.
Thursday & Friday: 8:00 a.m. – 5:00 p.m.
Saturday & Sunday: Closed
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2023 Top Lender: Banker & Tradesman
2023 Winner: Best of Central Mass
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2022 Top Lender: Banker & Tradesman
FAQs
What is Home Equity?
Simply stated, home equity is what your home is worth, minus anything you owe. In other words: Equity = Home Value – Liens.
Say you’ve taken out a 30-year mortgage for $280,000 on a home that is valued at $350,000. You’ve been making payments for 10 years, and the remaining balance of your loan is now $145,000. The difference between the current market value of the home and what you have left to pay is the amount of equity you have. In this case, it’s $205,000. This amount can vary based on what your home is worth at the time of calculation. The larger the down payment, the more equity you have on your home immediately. Because the borrowers in this example made a 20% down payment, they started with $70,000 in equity right away.
Is a home equity loan or line of credit better for me?
Many people use these to make improvements on their home, but they can also be used for various other reasons. See Home Equity Loans vs. Home Equity Lines of Credit for help with choosing which one is right for you. At Webster First, we will pay all of your standard closing costs for you. However, if you refinance or payoff a HELOC before having it open for two years, you will need to pay the closing costs.
Home Equity Loans have a fixed rate for their entire term, while HELOCs are fixed for the first two years, and adjusted to prime rate thereafter.
How does the draw period on my HELOC work?
In the state of Massachusetts, our HELOCs have an endless draw period, meaning you can use available funds from your line at any time, for as long as you keep it open.
Lines of credit in the state of Connecticut have a draw period of 5 years and repayment period of 15 years, with the option for the draw period to be extended at the credit union’s discretion.
If draw period = 5 years then repayment period = 15 years
If draw period = 10 years then repayment period = 10 years
If draw period = 15 years then repayment period = 5 years
How am I billed?
Home Equity Loan and HELOC bills are cut on the 16th of the month with a due date of the 15th on the following month. There are no late fees on these loans, however, you will still be reported to the credit bureaus as late after 30 days have gone by.
Note: If you make a HELOC payment on the 16th or later, the payment will satisfy the interest for both months first, then any remaining balance will be applied to principal.
What is a Finance Charge?
You will see the term “Finance Charge” on HELOC bills. This is just another way of saying interest. The monetary amount you see under Finance Charge is the amount the credit union charges you for the loan.
How do I pay down or pay off my Home Equity?
Contact the Mortgage Servicing department at (800) 962-4452 Ext 4094 or mortgageservicing@websterfirst.com to receive a quote (or have your attorney do it). Payment can then be applied by mailing in a check, transferring the balance from another account, or dropping off the funds in branch. If you are transferring funds from another account, have the mortgage servicer apply the payment to ensure it is done correctly.
Once you have received a quote for a HELOC, it is important that you do not draw funds from it until your pay down, payoff, or refinance is complete, as this will change the numbers on the quote.
What’s the difference between a paying down and paying off?
Because a HELOC is a revolving line, paying it down means paying the balance down to $0 but leaving the line open for you to draw off of in the future. Paying off a HELOC means that your line will be closed and discharged at the registry of deeds, and no additional funds can be drawn from it. When you receive your quote for a payoff it will have a discharge fee included, while a quote for a pay down will not.
Additionally, a payoff quote for a HELOC that has been open for less than two years will have your closing costs included in the fee section. A pay down would not.
Fixed Home Equity loans cannot be paid down. All available funds are disbursed to you immediately in the form of a deposit, and you pay back the funds for your selected term (up to 15 years).
How do I increase my HELOC limit?
The only way to increase the limit of your HELOC is to refinance into a new one. Talk with one of our licensed loan officers to do this.
What is a Max Equity?
Max Equities are any Home Equity Loan or LOC with an LTV (Loan-to-Value) ratio of over 80%. This can happen when the value of the house doesn’t come in high enough on the appraisal. These loans have a 10-year draw period and 10-year payback period regardless of the state the property is in. They will have a higher interest rate and PMI, but the credit union will pay PMI for you on an equity just as it pays the closing costs.