Home equity borrowing is rising again. Here's why it makes sense for homeowners now.

Homeowners across the nation are increasingly turning to their home equity for borrowing purposes in 2026, according to the latest figures from the Intercontinental Exchange (ICE) Mortgage Monitor Report. Nearly 548,000 homeowners have taken advantage of this option so far this year, collectively withdrawing over $54 billion in equity, marking the highest number of borrowers and second-largest withdrawal volume in a quarter since 2022.

Second liens continue to lead the way, with $29.5 billion in home equity loans and lines of credit withdrawn in the second quarter alone, though slightly down from their peak in 2025.

Despite the risks associated with borrowing against home equity, it can still be a smart financial move for homeowners this fall and beyond. There are three compelling reasons why it makes sense now:

1. The amount of available equity is unprecedented. With home equity levels at a record high in 2025, homeowners have access to a staggering $11.4 trillion in tappable equity, providing ample room to borrow regardless of the size of the loan needed, whether it's $20,000 or $200,000. This level of funding is far more accessible than with personal loans or credit cards, which often come with much higher interest rates and costs.

2. Interest rates on home equity products are significantly lower than alternatives. While the average personal loan interest rate is over 12% and credit card rates exceed 22% in September 2026, home equity loan and HELOC rates are currently in the low 8% range, offering a much more affordable borrowing option. Although these rates may rise in the future, they are considerably cheaper than the alternatives, making home equity borrowing an attractive choice for many homeowners.

3. Flexibility in product choice. Homeowners have both fixed-rate and variable-rate options to consider, depending on their expectations for future interest rate movements. Fixed-rate home equity loans provide protection against potential rate hikes, while variable-rate HELOCs can benefit from future rate cuts. Either way, borrowers have the flexibility to choose the product that best aligns with their financial goals and market outlook.