Home Equity Lines of Credit (HELOCs)

Overview

Rates as low as 4.74% variable APR on HELOCs1

Prime minus 0.26% for the life of the line.

Right now, qualifying Home Equity Line of Credit (HELOC) applicants may be eligible for a special variable rate of Prime minus 0.26% for the life of the line.1 (Special rate is currently 4.74% variable APR.) Act fast! This offer ends June 30, 2018.

Features

HELOC features

You can use a HELOC for a variety of purposes, including home improvements, major purchases (appliances, cars, RVs, boats, etc.), refinancing your existing mortgage,2 debt consolidation,3 and miscellaneous expenses. With a HELOC, you’ll enjoy features including:

Easy-to-access funds

Access your credit line whenever you need funds with four convenient options: a Visa® Platinum Credit Card, convenience checks, by phone or in branch. (Visa® Platinum Credit Card is not available to make draws in Texas.)

Competitive rates

Enjoy a competitive adjustable rate, with monthly payments that vary based on the rate and your outstanding balance. 

Interest-only payment options

Opt to make interest-only payments during the draw period. Interest-only payments may result in a lower monthly payment. However, your monthly payment will likely increase after the draw period ends. 

Fixed-rate advance

Choose to "lock in" up to three portions of your line of credit at a fixed rate, with fixed monthly payments. With a fixed-rate advance, you can pay down interest and principal, so funds become available for use again. A $75 fee is charged for each fixed-rate advance and is waived for your first transaction.1

Bank-paid closing costs

Speak with a banker to see if you qualify for special bank-paid closing costs. You may qualify if your line of credit is between $10,000 and $500,000 and certain conditions are met.4

Potential tax benefits

Potentially lower your tax bill when you deduct interest paid on your year-end taxes. (Please note that tax laws regarding the deductability of interest paid on HELOCs have recently changed. Consult a tax advisor regarding the potential deductability of interest and charges.)

Terms & Eligibility

Special offer eligibility

Special variable rate offer of Prime minus 0.26% for the life of the line of credit is available only on Home Equity Line of Credit (HELOC) applications for lines of credit in amounts between $25,000 and $1,000,000 that are received between April 1, 2018, and June 30, 2018, and close on or before August 15, 2018.

You must be an Alabama, Arizona, California, Colorado, Florida, New Mexico, or Texas resident to be eligible and must also meet the following qualifications:

  • Combined loan-to-value (CLTV) for the property securing the HELOC cannot exceed:
    • 85% for HELOCs in amounts of $300,000 or less in eligible states other than Texas; or
    • 80% for HELOCs in amounts between $300,001 and $1,000,000 in eligible states other than Texas and HELOCs in Texas in amounts between $25,000 and $1,000,000.
  • Must have a FICO score of 720 or higher at the time of application
  • Must auto-debit all monthly payments from a BBVA Compass checking account
  • Must take advances totaling at least $25,000 within 15 days of the closing date
  • Must have at least $25,000 outstanding on the line of credit at the end of the 15th calendar day after closing (not applicable if the property securing the line of credit is located in Texas)

Important HELOC terms

Annual Fee

A $75 annual fee is charged on the first anniversary of the line and every year thereafter (not applicable in Texas).

Fixed-Rate Advance Fee

A $75 fee is charged for each fixed-rate advance taken and is waived for your first transaction.

Minimum Required Periodic Payment

During the draw period, you must make a monthly payment of $75 or the accrued finance charges, whichever is greater.

Term Draw Period

Your draw period may last up to 10 years. Please speak with a banker to determine the draw period for your HELOC.

Repayment Period

  • 15 years if the balance owed is $20,000 or more
  • 10 years if the balance owed is less than $20,000

Maximum Interest Rate Cap

Maximum APR for all HELOCs will not exceed 18%.

 

How does a home equity line of credit work?

Have questions about how HELOCs work? Consult this guide to applying, borrowing, and paying down a home equity line of credit.

Comparison Chart

Is a home equity loan or HELOC right for you?

Want to make the equity in your home work for you? Compare our home equity loans and HELOCs to determine which option is a good fit for your situation.

Features HELOC Home Equity Loan

Fixed or Variable Rate

Variable APR, with option to lock in a fixed rate for three portions of the line of credit

Fixed rate, with fixed monthly payments

Disbursal of Funds

Funds available as you need them

Funds disbursed as a lump sum

Bank-Paid Closing Costs

Available if you qualify

Available if you qualify

Potential Tax Benefits

Yes

Yes

Interest-Only Payment Option

Yes

Yes

How to Apply

Apply Now

Find a Location

Call 1-844-443-2282

Apply Now

Find a Location

Call 1-844-443-2282

FAQs

Frequently asked questions

What is a HELOC?

A home equity line of credit, or HELOC, is a revolving line of credit that uses your home as collateral. A HELOC works much like a credit card—allowing you to draw approved credit at any time during a specified draw period.

Monthly payment amounts are based on the outstanding line balance and when payments are made, credit becomes available again.

How does a HELOC work?

A home equity line of credit, or HELOC, is a line of credit you get based the amount of equity you have in your home, your creditworthiness, and your debt-to-income ratio.

Interest Rate: The interest rate on a HELOC is adjustable, meaning it changes periodically to reflect market conditions.

Terms: A typical term for a HELOC is 20 years with a draw period of 10 years, during which time you can access your credit as you need it up to the limit.

During the draw period, you will only pay interest on the balance (not principal); therefore, your monthly payment will change based on your outstanding balance. During the draw period, you will regain access to your credit up to the limit when you pay down your balance, much like a credit card.

Repayment: The second phase of a HELOC is the repayment period during which you can no longer draw on your line and must start paying back your balance plus interest.

What can I use a HELOC for?

You can use your funds for a variety of purposes, including home improvements, major purchases (appliances, cars, RVs, boats, etc.), refinancing your existing mortgage, debt consolidation, and miscellaneous expenses.   

Is a HELOC secured or unsecured debt?

A home equity line of credit is secured by the equity in the borrower’s home; therefore, it is considered secured debt.

How much equity is required for a HELOC?

Most lenders require borrowers to maintain 10-20 percent of their equity after taking out a home equity loan or line.

For example, if your home is worth $300,000 and you owe $200,000 on your first mortgage, based on 10-20 percent loan-to-value ratio, you could borrow between $40,000 and $70,000. Of course how much you can borrow also depends on your creditworthiness and your debt-to-income ratio.

How does a HELOC affect my credit score?

A home equity line of credit will appear on your credit report as a revolving line of credit. A HELOC is considered a “secured” line of credit, which can make it more favorable to credit agencies than a credit card or unsecured line of credit.

What matters most is how you manage your line of credit. Missing or late payments can have a negative impact on your score, as can maxing out your available credit.

Can I get a HELOC if I have a mortgage?

Yes, you can if you have enough equity in your home to borrow against. If you have not built sufficient equity in your home you likely not be able to qualify for a HELOC.

What’s more, many lenders prefer that you have your mortgage for at least a year or two before you can apply for a home equity loan or line of credit.

If you do have sufficient equity and acceptable credit, you can qualify for a HELOC while also having a mortgage. In fact, home equity loans and lines are often referred to as “second mortgages.”

Can I get a HELOC with an FHA loan?

The FHA (Federal Housing Administration) doesn’t offer home equity lines of credit. However, if you have an FHA loan and build up enough equity in your home, you can apply for a HELOC from another lender.

Details you need to make a smart decision

1Offer Eligibility: Special Variable Rate Offer of Prime minus 0.26% for the life of the line of credit (the “Offer”) is available only on Home Equity Line of Credit (HELOC) applications for lines of credit in amounts between $25,000 and $1,000,000 that are received between November 16, 2017 - June 30, 2018 and close on or before August 15, 2018. Eligibility for the Offer depends on the specific characteristics of your credit transaction, including credit line amount, your credit score and history, lien position, collateral location, and term. Applicants may be approved for a HELOC but determined to be ineligible for the Offer. In order to be eligible for the Offer: (i) borrower must have a FICO score of 720 or higher at the time of application; (ii) borrower must have a BBVA Compass checking account and auto debit all monthly payments from such account; and (iii) borrower must take advances totaling at least $25,000 within 15 days of the closing date and must have at least $25,000 outstanding on the line of credit at the end of the 15th calendar day after closing (not applicable if the property securing the line of credit is located in Texas). In addition, the combined loan-to-value (CLTV) for the property securing the HELOC cannot exceed (i) 85% for HELOCs in amounts of $300,000 or less; or (ii) 80% for HELOCs in amounts between $300,001 and $1,000,000 and HELOCs in Texas in amounts between $25,000 and $1,000,000. Offer is only available to California, Texas, New Mexico, Arizona, Colorado, Alabama and Florida residents.

The Annual Percentage Rate (APR) for HELOCs qualifying for the Offer is variable and is based on the Wall Street Journal U.S. Prime Rate (as of 6/15/2018, Prime Rate was 5.00%) minus the designated margin of 0.26%. In no event will the APR be less than 3.50%, which is the floor rate and the maximum APR for all HELOCs will not exceed 18%. The Offer’s promotional APR is subject to forfeiture upon borrower becoming 60 or more days past due. Special Variable Rate Offer may not be combined with any other promotional discount, but may be combined with Bank-paid closing costs.

2Offer is not available for line increases on existing BBVA Compass HELOCs, Purchase Money Second Lines or to refinance existing BBVA Compass HELOCs or Home Equity loans, except for Texas borrowers in limited circumstances.

HELOC: All HELOC applications are subject to program eligibility, underwriting, and collateral requirements and approval, including credit approval. BBVA Compass must receive a valid first or second real estate lien on a primary or secondary residence occupied by the borrower, provided that HELOCs secured by non-homesteaded properties are not available in Texas. Property insurance required, including flood insurance where applicable. Minimum required periodic payment is $75 or total line amount outstanding, whichever is less. A $75 annual fee is charged on the first anniversary of the line and every year thereafter (not applicable in Texas). A $75 fee is charged for each fixed rate conversion option that is exercised, waived for the first transaction. Texas HELOCs: Maximum credit line cannot exceed 50% of appraised value of property securing the line of credit. BBVA Compass must receive a valid first or second real estate lien under Article XVI, Section 50(a)(6) of the Texas Constitution on a primary residence occupied by the borrower. Minimum draw in Texas is $4,000. In order to use convenience checks to make draws, borrower must submit request for convenience checks to BBVA Compass. VISA Platinum Credit Card is not available to make draws in Texas.

3Debt Consolidation: The relative benefits you receive from loan consolidation will vary depending on your individual circumstances. If your Home Equity Loan has a longer term than the bills you are consolidating, you may not realize savings over the entire terms of your Home Equity Loan or Line.

4Closing Costs: BBVA Compass will pay for all closing costs on new home equity products with amounts ranging from $10,000 to $500,000. Credit requests for less than $10,000 or more than $500,000 shall be subject to actual closing costs incurred and permitted by law. To qualify for Bank-Paid Closing Costs, the borrower must complete a $10,000 draw requirement within 30 days which must remain outstanding for 90 days (not applicable to Texas HELOCs due to Texas law). Bank-paid closing costs are subject to recoupment from borrower(s) if the line of credit is paid off and closed within 2 years (not applicable in Texas). Closing costs vary by state and typically range from $675 on a $10,000 credit line to $6,250 on a $500,000 credit line. Texas closing costs typically range from $935 to $4,165 depending on credit line amount. For lines up to $1,000,000, typical closing costs may be as much $7,339 in Texas and $11,114 in states other than Texas.

BBVA Compass is a trade name of Compass Bank, a member of the BBVA Group. Compass Bank, Member FDIC and an Equal Housing Lender. Rev. 06/2018 / #429266 / NMLS#402936