HELOC rates in Tennessee rose from 4.2% in 2021 to 8.7% by November 2024. With rates consistently climbing, homeowners considering a HELOC might benefit from locking in current rates to avoid paying more in the future.
HELOC
Best HELOC Rates in Tennessee
Updated: November 19, 2024
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Key Takeaways
Higher loan-to-value (LTV) ratios lead to higher rates. The average APR for a HELOC in Tennessee with an 80% LTV is 8.3%, compared with 9.0% for a 90% LTV.
HELOC rates vary by city in Tennessee. Pegram has an average APR of 4.8%, whereas Lake City's is 10.6%.
Different lenders offer varying rates for the same loan types. Listerhill Credit Union's average APR is 4.0%, whereas Pinnacle Bank's is 11.8%.
Current HELOC Rates in Tennessee
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HELOC Rates in Tennessee by LTV Ratio
HELOC rates in Tennessee vary based on your loan-to-value (LTV) ratio and line limit. Lenders view a lower LTV as less risky, as you have more equity. For instance, with an 80% LTV, you've borrowed less against your home compared to a 90% LTV, reducing the chance to default on your HELOC.
The following table lets you filter between different loan amounts, offering a clearer view of what you may qualify for:
Data filtered by:Results filtered by:
Line Limit:
Line Limit:$100,000
HELOC Rates in Tennessee by City
HELOC rates in Tennessee vary between cities due to local housing markets and lender competition. For instance, cities with stable real estate markets may offer lower rates, reducing lender risk.
Use the table below to filter by your city and see average APRs for $50K and $100K HELOCs.
Data filtered by:Results filtered by:
City:
City:Nashville
| $100,000 | 8.8% |
| $50,000 | 8.8% |
HELOC Rates in Tennessee by Lender
HELOC interest rates in Tennessee differ among lenders due to varying pricing strategies and risk assessments. Compare competitive rates by reviewing the table below, which highlights the five lenders in Tennessee offering the lowest average APRs.
| Listerhill Credit Union | 4.0% |
| United Community Bank | 4.8% |
| SmartBank | 5.6% |
| Cornerstone Financial Credit Union | 6.8% |
| Leaders Credit Union | 7.0% |
HELOC rates today can vary between lenders even in the same city. Use the table below to filter by city and compare APRs to find the best rate in your area.
Data filtered by:Results filtered by:
City:
City:Nashville
| United Community Bank | Commercial Bank | 4.8% |
| Synovus Bank | Commercial Bank | 7.4% |
| Wilson Bank & Trust | Commercial Bank | 7.9% |
| American Airlines Federal Credit Union | Credit Union | 8.0% |
| Ascend Federal Credit Union | Credit Union | 8.0% |
| FirstBank | Commercial Bank | 8.0% |
| Southeast Financial Credit Union | Credit Union | 8.0% |
| US Community Credit Union | Credit Union | 8.0% |
| Volunteer State Bank | Commercial Bank | 8.0% |
| Republic Bank & Trust Company | Commercial Bank | 8.3% |
| Fortera Federal Credit Union | Credit Union | 8.3% |
| Old National Bank | Commercial Bank | 8.5% |
| Cadence Bank | Commercial Bank | 8.5% |
| Enbright Credit Union | Credit Union | 8.5% |
| First Farmers and Merchants Bank | Commercial Bank | 8.5% |
| First Horizon Bank | Commercial Bank | 8.5% |
| Regions Bank | Commercial Bank | 8.5% |
| Bank of Tennessee | Commercial Bank | 8.8% |
| First South Financial Federal Credit Union | Credit Union | 9.0% |
| Simmons Bank | Commercial Bank | 9.2% |
| U.S. Bank National Association | Commercial Bank | 10.4% |
| Truist Bank | Commercial Bank | 10.6% |
| Fifth Third Bank | Commercial Bank | 10.9% |
| Bank of America | Commercial Bank | 11.0% |
| Pinnacle Bank | Commercial Bank | 11.8% |
COMPARING HELOC RATES IN TENNESSEE: BANKS VS. CREDIT UNIONS
HELOC rates in Tennessee vary between banks and credit unions, with commercial banks typically offering higher rates. The average HELOC rate for commercial banks in Tennessee is 8.6%, while credit unions, as not-for-profit institutions, offer a slightly lower average rate of 8.3%. Understanding the nature of credit unions can help you make a more informed decision.
Consider more than just rates when choosing between banks and credit unions. Banks may offer more convenience and a wider range of services, while credit unions often provide better customer service and lower fees. It's also important to check membership requirements for credit unions and be aware of any hidden fees or rate adjustment clauses from both types of lenders.
Expert Answers About HELOCs
What are the primary factors that influence HELOC rates, and how can homeowners ensure they get the best rate?
Credit & Mortgage Expert
There are many factors that influence HELOC rates, but the most critical are the following:
Credit score is a crucial factor in determining your interest rate for a HELOC. The higher your credit score, the lower rate you will qualify for. Shoot for a 760 credit score or higher.
Debt-to-income is a vital factor. If the lender doesn’t think you have the ability to repay the debt, you will be denied. Focus on paying off as many credit cards or loans as possible before applying for a HELOC.
Loan-to-value — how much money you borrow based on how much your home is worth plays a large role in interest rate. The more you take out, the higher the risk is for the lender, which translates to a higher interest rate for your loan.
HELOC Payment Calculator
HELOCs have become a popular tool for homeowners across the U.S. looking to tap into their home's equity. Use our Tennessee HELOC payment calculator to determine your monthly payments based on the amount drawn, APR and loan terms. Our calculator also provides a full amortization schedule, showing how much goes toward interest and principal over time. Understanding these details can help you manage your HELOC and plan for future payments.
Tennessee HELOC Payoff Calculator
This HELOC payment calculator assumes that you take out one lump sum at the start of your interest-only period. Your actual payoff schedule will vary depending on your interest rate and market conditions.
Credit Line Information
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Repayment Period Payment
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- Graph view
- Table view
- Amortization
Credit Payoff Schedule for Home Equity Line
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Ending balance
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How to Get the Best HELOC Rates in Tennessee
Finding the best HELOC rates in Tennessee can help you save thousands over the life of your loan. To secure the most competitive rate, consider these five strategies:
Maintain a strong credit score
The average credit score in Tennessee is 705. Improving it can help you secure more competitive HELOC rates.
Compare offers from multiple lenders
Settling for the first offer you receive may be costly. By shopping around, you can find competitive rates and even use offers to negotiate better terms.
Reduce your debt-to-income (DTI) ratio
Lenders favor borrowers with lower debt-to-income (DTI) ratios because it shows financial stability. Reducing your debt can make you a more attractive candidate for a lower rate.
Increase your home equity
The more equity you have, the less risk the lender assumes, which can lead to a lower rate. Paying down your mortgage or making home improvements can increase your equity.
Review closing costs and rate caps
Some lenders charge closing costs between 2% and 5%, whereas others don't. Compare rate caps to limit your costs as rates adjust over time.
HELOC Loan Rates vs. Home Equity Loan Rates in Tennessee
HELOC interest rates in Tennessee average 8.4%, while home equity loan rates are lower at 7.8%. This difference arises from the variable rate structure of HELOCs compared to the fixed rates of home equity loans.
- HELOCs are flexible, revolving credit lines with variable rates that can increase in rising interest rate environments, potentially impacting homeowners' finances over time.
- Home equity loans provide a lump sum at a fixed rate, making them suitable for those who prefer financial certainty over flexibility.
When deciding between these options, consider your borrowing needs and risk tolerance. If you value the flexibility to borrow as needed, a HELOC might be beneficial, but if you prefer stable payments, a home equity loan could be more suitable. Also, assess how each option aligns with your home's equity.
CONSIDERING A HELOC ALTERNATIVE? TRY A CASH-OUT REFINANCE
A cash-out refinance is a HELOC alternative that replaces your existing mortgage with a new, larger loan, allowing you to access cash. Unlike HELOCs or home equity loans, it creates a new primary mortgage.
For example, if you have a loan backed by the Federal Housing Administration (FHA) and your home is valued at $300K with a $150K mortgage balance, an FHA cash-out refinance for $200K gives $50K cash, with payments based on $200K.
FAQ: Best HELOC Rates in Tennessee
What are the current HELOC rates in Tennessee and how do they compare to national rates?
The average HELOC rate in Tennessee is 8.4%, which is the same as the national average.
What fees are commonly associated with HELOCs in Tennessee?
Common fees include application fees, appraisal fees, annual fees, and early closure fees, but specifics vary by lender.
How do HELOC rates in Tennessee compare to home equity loan rates?
Tennessee's HELOC rates average 8.4%, while home equity loan rates are lower at 7.8%, which may be a consideration for those with bad credit.
How do HELOC Rates in Tennessee vary between banks and credit unions?
Commercial banks in Tennessee offer HELOC rates averaging 8.6%, while credit unions offer lower rates at 8.3%.
What's the best HELOC rate in Nashville? How does it compare to the current HELOC rate in Tennessee?
The average HELOC rate in Tennessee is 8.4%, while Nashville's rates are slightly higher, averaging 8.8%.
MoneyGeek examined 97 different banks and credit unions in Tennessee using S&P Global's SNL Depository Rates dataset to stay current on the latest home equity line of credit rates.
This data is accurate as of November 15, 2024.
97Lenders Analyzed
About Zachary Romeo, CBCA
Zachary Romeo is a certified Commercial Banking and Credit Analyst (CBCA), and the Head of Loans and Banking at MoneyGeek. Previously, he led production teams for some of the largest online informational resources in higher education, with over 13 years of experience in editorial production.
Romeo has a bachelor's degree in biological engineering from Cornell University. He geeks out on minimizing personal debt and helping others do the same through people-first content.