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 (December 2024)
Updated: December 21, 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 8.1%, compared with 8.8% for a 90% LTV.
HELOC rates vary by city in Tennessee. Mount Pleasant 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:
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Line Limit:$100,000
| 8.2% | 8.9% |
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.
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City:Nashville
| $100,000 | 8.7% |
| $50,000 | 8.7% |
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.
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City:Nashville
| United Community Bank | Commercial Bank | 4.8% |
| Synovus Bank | Commercial Bank | 7.4% |
| American Airlines Federal Credit Union | Credit Union | 7.7% |
| Southeast Financial Credit Union | Credit Union | 7.8% |
| Ascend Federal Credit Union | Credit Union | 7.8% |
| Enbright Credit Union | Credit Union | 7.8% |
| Wilson Bank & Trust | Commercial Bank | 7.8% |
| Volunteer State Bank | Commercial Bank | 8.0% |
| US Community Credit Union | Credit Union | 8.0% |
| FirstBank | 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% |
| First Farmers and Merchants Bank | Commercial Bank | 8.5% |
| First Horizon Bank | Commercial Bank | 8.5% |
| First Vision Bank of Tennessee | 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 banks generally offering higher rates. The best HELOC rate for commercial banks in Tennessee is 8.5%, while credit unions offer a slightly lower average APR of 8.2%. Credit unions, being not-for-profit institutions, often provide more competitive rates compared to traditional banks.
When choosing between the two, it's important to consider more than just rates. Banks may offer greater convenience, whereas credit unions often excel in customer service and have lower fees. Additionally, check for membership requirements at credit unions and be aware of any hidden fees or rate adjustment clauses with both lenders.
Expert Answers About HELOCs
What are the common fees or costs associated with HELOCs that borrowers should be aware of, and how do these affect the overall cost of borrowing?
Credit & Mortgage Expert
Most banks and credit unions charge little to no fees when getting a HELOC. Typically, you will pay the cost of the appraisal — anywhere from $150 to $450 depending on the type of appraisal done. But closing costs are usually covered by the bank or credit union. This is why it’s best to shop around with at least three different lenders when applying for a HELOC to compare not only the rates but also any costs involved. Getting a rate that is 0.25% lower but having to pay a couple thousand dollars in costs may not make financial sense.
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.
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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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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 8.3%, compared to 7.7% for home equity loans. The difference stems from their rate structures, with HELOCs having variable rates and home equity loans offering fixed rates.
- HELOCs are 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, ideal for those who prefer stable, predictable payments.
When deciding between these options, consider your financial goals and risk tolerance. If you value flexibility and can manage fluctuating payments, a HELOC might suit you. If stability and predictable costs are more important, a home equity loan could be the better choice.
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 8.3%, 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?
HELOC rates in Tennessee average 8.3%, while home equity loan rates are lower at around 7.7%, which may benefit those with bad credit.
How do HELOC Rates in Tennessee vary between banks and credit unions?
Commercial banks in Tennessee offer HELOC rates averaging 8.5%, while credit unions offer lower rates at 8.2%.
What's the best HELOC rate in Nashville? How does it compare to the current HELOC rate in Tennessee?
Nashville's rates are slightly higher, averaging 8.7%, compared to the Tennessee average of 8.3%.
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 December 13, 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.