Why rates are moving
Home equity rates don’t move on their own — they follow the Federal Reserve, inflation, and bond markets. Here’s the context behind the numbers.
National averages — illustrative context for how home equity products track the broader market.
- 30-Yr Fixed
- HELOC
- Home Equity Loan
What drives these rates
The Fed’s benchmark sets the floor for HELOC variable rates tied to prime. A pause or cut usually lowers HELOC rates within a billing cycle.
Fixed mortgage rates track the 10-year Treasury yield. When this yield falls, fixed rates — including cash-out refis — typically follow within days.
Cooling inflation gives the Fed room to cut rates. Sustained moves toward 2% tend to ease borrowing costs across all home equity products.
The gap between Treasury yields and mortgage rates. A widening spread can keep mortgage rates elevated even when Treasury yields drop.
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