HELOC requirements
Five things decide whether you qualify and how much you get: equity, credit, debt-to-income, income documents and the property itself.
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What are the requirements to get a HELOC?
To qualify for a HELOC, most lenders require at least 15%–20% equity left after the line (a combined loan-to-value of 80%–85% or less), a credit score of about 620 or higher, a debt-to-income ratio under about 43%, and verifiable income. Primary homes get the most lenders and the best rates.
On this page
Requirements at a glance
| Factor | Typical requirement | Best pricing |
|---|---|---|
| Combined loan-to-value | Up to 80%–85% | Under 70% |
| Credit score | 620+ at most lenders; some go lower | 760+ |
| Debt-to-income | Under about 43%; some allow up to 50% | Under 36% |
| Income | W-2s and pay stubs, or 2 years of tax returns if self-employed | Stable 2-year history |
| Property | Owner-occupied primary home | Single-family |
Use a free calculator, or get your HELOC rate from Shawn.
What real HELOCs look like
Across 9,601 HELOCs funded by Shawn Way's team from January 2023 to October 2026, the median line was $92,000 on a median home value of $500,000. 86% had a fixed rate, and 90% were on the borrower's primary home.
Source: HELOCHQ analysis of 9,601 HELOCs funded by Shawn Way's team, January 2023–October 2026. Historical starting rates on funded loans, not offers or quotes. Month by month: HELOC Rate Index.
How debt-to-income is figured
If you're consolidating, the card payments you're paying off usually drop out of the calculation, which can help you qualify.
Documents to have ready
- Photo ID
- Last 30 days of pay stubs and 2 years of W-2s, or 2 years of tax returns if self-employed
- Latest mortgage statement and homeowners insurance declarations page
- Statements for the debts you plan to pay off
How the home is valued
Many lenders use an automated valuation model for smaller lines and lower loan-to-value, which avoids an appraisal fee and saves days. Larger lines, higher loan-to-value or unusual properties usually need a full or desktop appraisal.
If you're close to the line
- Pay a card down before applying to lift your score and lower your DTI.
- Ask for a smaller line that keeps you under 80% combined loan-to-value.
- Add a co-borrower on the title with income.
Will you qualify? An example
Home value: $600,000. Mortgage: $350,000. Gross income: $9,000 a month. Monthly debts: mortgage payment $2,400 (with taxes and insurance), car $450, minimum card payments $300.
- Equity: at an 85% cap, total debt can reach $510,000, so the line could be up to $160,000.
- Debt-to-income today: ($2,400 + $450 + $300) ÷ $9,000 = 35%.
- With a $50,000 line: many lenders count a payment based on the full line or the expected balance. At about $323 interest-only, DTI becomes about 39%. If the HELOC pays off the cards, the $300 drops out and DTI ends near 36%.
This borrower qualifies comfortably at most lenders. Push the car payment to $900 and the cards to $800 and DTI would sit near the top of what lenders allow.
Property and occupancy rules
- Primary residences get the most lenders and the best pricing.
- Second homes usually get a lower cap (often 70%–80%) and a higher margin. Second homes.
- Investment properties are offered by fewer lenders, with lower caps. Rentals.
- Condos, co-ops, manufactured homes and homes in trusts each have their own rules. See the guides for condos, co-ops, manufactured homes and trusts.
Credit history beyond the score
Lenders also look for recent late payments (especially on the mortgage), collections, and bankruptcies or foreclosures, which usually require waiting periods. A single late payment two years ago rarely matters; a late mortgage payment in the past year often does. After bankruptcy · Lower credit.
Income lenders can use
- W-2 salary and hourly pay, with a two-year history (overtime and bonuses usually need two years too).
- Self-employment income, averaged over two years of tax returns, or bank statements with some lenders. Self-employed.
- Social Security, pensions and retirement account distributions. Retirees.
- Rental income, usually from tax returns or leases.
- Alimony and child support with a history and at least three more years remaining.
Quick checklist before you apply
- Estimate your value conservatively and do the 85% math.
- Pull your credit reports (free at AnnualCreditReport.com) and fix errors.
- Gather two years of income documents and recent statements.
- Confirm your homeowners insurance is active and know your mortgage balance.
- Avoid opening new credit or financing big purchases until the line is open.
Related question: High-LTV HELOCs
Related question: HELOC for non-U.S. citizens
Related question: HELOC between jobs
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Sources
Official sources behind this guide.
- What is the difference between a home equity loan and a HELOC? · Consumer Financial Protection Bureau
- What you should know about home equity lines of credit (booklet, PDF) · Consumer Financial Protection Bureau
- Regulation Z §1026.40: Requirements for home equity plans · Consumer Financial Protection Bureau
- Find a HUD-approved housing counselor · Consumer Financial Protection Bureau