If you’re thinking about a home equity loan in Texas, there’s a lot to consider. To find the best Texas home equity loans you have to research lenders, rates, and borrowing limits. There are additional factors, like qualifying for a Texas home equity loan and your existing debt level.
We’ve put together a list of the best Texas home equity loans so you can easily compare rates, terms, and loan requirements. Find out more about home equity loan providers in Texas.
What is a Home Equity Loan?
Purchasing a home with a mortgage means your lender provides most of the money for the purchase, and you repay it over time. As you make mortgage payments and your property appreciates in value, you build equity. This is the portion of your home you truly own.
A home equity loan allows your to borrow against the equity you’ve built by paying down your mortgage. A home equity loan is sometimes called a second mortgage because you have to pay the loan back as you continue to pay your mortgage. A home equity loan helps people access a lump sum of cash at one time to help cover emergency expenses or other things that require a lot of cash. Home equity loans have an application process and fees associated with applying and closing the loan.
A home equity line of credit or HELOC is another variety of home equity loan. A HELOC acts more like a revolving credit line. You’ll recognize revolving credit if you use a credit card. You’re approved for a set credit limit, and you can withdraw funds as needed during the draw period. As you repay, those funds become available again. HELOCs often come with variable annual percentage rates or APRs, meaning your payments can fluctuate.
However, many of the best nationally recognized home equity loan providers now offer fixed HELOC rates. This structure works well for ongoing projects or unpredictable expenses.
How We Ranked the Best Home Equity Loans in Texas
The Texas real estate market ranges from big-city living in Dallas or Houston to more rural living in less densely populated areas, so borrowers within the state need options that match their financial situations. To identify the best lenders, we evaluated companies based on the following criteria.
- Loan amount limits
- Interest rates, including availability of fixed and variable options
- Eligibility criteria, such as credit score, income, loan-to-value or LTV ratio
- Fees, like closing costs, application fees, annual or membership charges
- Customer service and lender reputation
- Range of borrowing products offered
- Repayment terms flexibility
- Length of time in business and experience
We focused on finding lenders that offer affordable, accessible, and transparent home equity financing specifically tailored for Texas homeowners, no matter where you reside in the Lone Star State.
What to Know About a Texas Home Equity Loan
Home equity loans are available in all 50 states and each state can have specific rules regarding them. Texas stands out with its home equity loan rules. You can only have one home equity loan at a time in Texas. Often people will want to take a home equity loan out on a secondary property, but that’s only allowed in Texas if you’ve paid the mortgage on your primary home in full.
Additionally, Texas caps the amount you can borrow against your home equity at 80% of the home’s appraised value. Some lenders will set a limit in addition to the 80% rule.
The Best Home Equity Loan in Texas
LendingTree
Best Overall
Review
LendingTree offers a great resource for those searching for a home equity loan. While LendingTree has a lot of useful information, it won’t serve as a lender. Instead, the company connects you with lenders so you can find the right deal. LendingTree enjoys high reviews from users who have found the service helpful. LendingTree leverages its partnership with lenders so you don’t have to go through the application process with several lenders separately.
About
LendingTree simplifies the home equity loan search by doing the work for you. After you provide some information, the company will discover the best home equity lenders for your situation. LendingTree will match you with five lenders and you can continue the home equity loan process with the lender you like best.
Features and Benefits
- Quick application process and funding
- Approval qualifications vary by lender
- Find rates across companies simply
- Offers access to several types of financial services
- Application doesn’t affect credit score
Why we Chose
LendingTree is great for those who want to consolidate the home equity loan process into one step. You can find multiple rates through LendingTree, saving you from visiting several lenders and submitting applications. Though you have to submit personal information to the platform, it won’t affect your credit score, which is reassuring for those who worry about applying to multiple places for a home equity loan in Texas. With LendingTree you can compare lender rates and terms in one place to find the right fit for your needs.
Pros
- Receive up to five loan offers
- Application doesn’t affect credit score
- Has A+ BBB rating and 4.3 stars out of 5 from Trustpilot based on more than 13,000 reviews
Cons
- Personal information shared with several lenders
- Rates and closing costs vary by lender
- Matches not guaranteed
Check Your Rates without affecting your credit score
| Loan Amounts | Varies by lender |
| Terms (Months) | Varies by lender |
| APR | Varies by lender |
Navy Federal Credit Union
Best for Armed Forces affiliated applicants
Review
Navy Federal Credit Union is one of the most trustworthy credit unions in the world and holds assets that exceed more than $166 million. The credit union does require membership and once you join, you can enjoy extensive benefits. Those benefits include lower interest rates, reduced fees, and discounts. Navy Federal doesn’t have closing costs with its home equity loans, either. The credit union has high borrowing limits with home equity loans, but its rate can fall on the higher end of the spectrum.
About
Navy Federal Credit Union is one of the longest-running home equity loan providers in the industry. Founded in 1933 with only seven members at the time, the business has become the largest credit union in the world. It boasts more than 10 million members. Initially designed for members of the armed forces, it has since expanded to include family members of those who have served in the military. Navy Federal Credit Union offers a full suite of financial services.
Features and Benefits
- 24/7 customer support
- Can track loan status online or on an app
- Offers a full suite of financial services
- Provides personal guidance throughout loan process
- No early repayment penalties
Why we Chose
For those with a connection to the armed forces, Navy Federal Credit Union is a terrific option for a home equity loan in Texas. Navy Federal Credit Union has competitive rates and generous borrowing terms. You can borrow up to 100% of your home’s equity, plus there isn’t a penalty for repaying your Texas home equity loan early. You can choose between 5, 10, 15, or 20-year loan terms and borrow up to $500,000. Navy Federal Credit Union maintains fixed interest rates with home equity loans and will remain the loan servicer for the life of the loan.
Pros
- $0 closing costs
- No obligation or origination fee
- Can borrow up to 100% of home equity
Cons
- Need to have an affiliation with the armed forces to join
- Can take up 55 days before funds become available
- HELOCs not available in Texas
| Loan Amounts | $10,000 to $500,000 |
| Terms (Years) | 5, 10, 15, 20 |
| APR | As low as 7.34% |
Greater Texas Credit Union
Best for low rates for borrowers with excellent credit scores
Review
Credit unions have advantages over traditional lenders and Greater Texas Credit Union stands out because it can offer rates others can’t match. The credit union also allows lower borrowing minimums.Greater Texas Credit Union has a lower borrowing limit than other lenders.
About
As a credit union, Greater Texas Credit Union has some of the best home equity loan rates around. The APR starts at 5.67% with a $10.000 minimum. The rate rises with longer terms to 6.26% for 15 years and 6.8% for 20 years. Even those rates fall below those of competitors. You do have to join the credit union to enjoy those rates. You can become part of the credit union with a $5 deposit.
Greater Texas Credit Union requires a 600 credit score and allows a maximum loan amount of $300,000 or 80% of your home’s equity. It can take a little longer to get approved and access funds compared to other lenders, but the lower rates can be worth the wait.
Features and Benefits
- Loan maximum of $300,000
- No prepayment penalties
- Minimum credit score of 600 required
- Has payment calculator available
- $10,000 minimum to borrow to refinance current loan
Why we Chose
We picked Greater Texas Credit Union because of its low interest rates. With rates that start at 5.67%, it’s hard to find a better deal around. Greater Texas Credit Union also does not have closing costs and there is no penalty for prepayment of your home equity loan. There is a tradeoff with those low rates. Greater Texas Credit Union can’t match the speed in which competitors offer with funding.
Pros
- No prepayment penalties
- Interest paid can be tax deductible
- No closing costs
Cons
- Appraisal required on loans of $100,000 and more and if the Loan to Value ratio of the property is more than 65%
- Home has to be in Texas
- Closing period can take around 20 days
| Loan Amounts | $10,000 and $300,000 |
| Terms (Years) | 5, 10, 15, 20 years |
| APR | Rates start at 5.67% |
Rocket Mortgage
Best customer service
Review
Rocket Mortgage has established itself as a top national lender through the years but it tends to have a more restrictive borrowing policy than competitors. Rocket Mortgage limits home equity loan terms to 10 or 20 years. There is also a $350,000 cap on home equity loans. The minimum borrowing amount starts at $45,000. Unlike other lenders, Rocket Mortgage doesn’t disclose its rates and it’ll run a credit check if you want to apply for a home equity loan.
About
Rocket Mortgage offers generous home equity loan borrowing limits. You will need to get your home appraised before getting a home equity loan and terms are limited to 10 or 20 years. Rocket Mortgage doesn’t post its loan rates, which makes it difficult to compare to other lenders. You can easily apply for a home equity loan online and it can take a little more than two weeks to get a loan after applying.
Features and Benefits
Ranks second in mortgage origination satisfaction by JD Power
Easy-to-use mobile app and online approvals
Can borrow up to 90% of home’s value
Why we Chose
Rocket Mortgage makes it easy to apply for a home equity loan through its website and mobile app. The lender makes the process go quick and has generous lending limits. Those who have used Rocket Mortgage have a high rate of satisfaction.
Pros
High customer satisfaction
Can take out up to $500,000
Can take a loan on a secondary home
Cons
Must have paid at least $45,000 of mortgage
Need a credit score of 680 or better
Closing costs range between 2% and 6%
| Loan Amounts | $45,000 to $500,000 |
| Terms (Years) | 10 to 20 |
| APR | Not disclosed |
Figure
Best for quick HELOCs
Review
Figure enjoys rave reviews for its HELOC offerings. The company makes applying for a HELOC quick and easy. You can receive funding in as few as five days. Figure differs from other lenders in its rates and borrowing limits. Figure caps its lending limit at $400,000 and its lowest rate starts at 7.4%. It’s a competitive rate but it rises after that, depending on your credit history and borrowing amount. There is also an origination fee with Figure and you only have up to five years to draw on the line of credit.
About
Figure specializes in home equity lines of credit (HELOCs) for homeowners in need of cash and want to use their home equity to draw upon. HELOCs differ from home equity loans in that they offer access to cash for homeowners for a period of time, also known as a draw period. A home equity loan provides a lump sum of cash at one time. HELOCs require homeowners to pay back the amount they borrow and they can decide how much they want to borrow. With a HELOC you can borrow multiple times instead of just once with a home equity loan.
Figure offers HELOCs of between $15,000 and $400,000 for a term of 30 years. That comes with a draw period of two to five years. Homeowners need to have a credit score of 640 to qualify. Higher HELOC amounts require a higher credit score.
Features and Benefits
- Offers HELOCs exclusively
- Funding can take place in as few as five days
- Has fixed rates
- Can borrow up to $400,000 and 85% of home equity
Why we Chose
Figure makes applying and obtaining a HELOC easy through its website and offers fast approval with funding. It also offers fixed rates and requires a minimum credit score of 640. Figure also doesn’t require an in-person appraisal if it’s not required in your state.
Figure does have an origination fee of 4.99% of your initial draw and you have a draw period of two to five years. You can also enjoy a discount by enrolling in autopay.
Pros
- Discounts available if you enroll in autopay
- No in-person appraisal needed
- Fast funding and approval process
Cons
- Has one-time loan origination fee
- Draw period lasts two to five years
- Lower borrowing maximum than competitors
| Loan Amounts | $15,000 to $400,000 |
| Terms (Years) | Up to 30 |
| APR | 7.4% to 17.2% |
