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Federal Reserve Cuts Rates, Boosts Home Equity Options

12/29/2025

Summary

Story summary

The Federal Reserve's December rate cut lowered rates for home equity products, reducing the cost of a $50,000 home equity line of credit (HELOC) versus early 2024.
HELOCs offer flexibility to draw funds as needed while preserving existing low mortgage rates.
Cash-out refinancing may help homeowners with higher mortgage rates.
Experts advise homeowners to weigh their needs and the implications of borrowing against home equity, and to use funds wisely.

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Story summary

The Federal Reserve's December rate cut lowered rates for home equity products, reducing the cost of a $50,000 home equity line of credit (HELOC) versus early 2024.
HELOCs offer flexibility to draw funds as needed while preserving existing low mortgage rates.
Cash-out refinancing may help homeowners with higher mortgage rates.
Experts advise homeowners to weigh their needs and the implications of borrowing against home equity, and to use funds wisely.