Cabot, Arkansas Home Equity Line of Credit Rates 2026

Long-term interest rates present a real conundrum here. 10-year rates have fallen from 3.05% to as low as 2.35% over the last six months. Fears of a global recession and Brexit uncertainty have caused money to pour into the US and to drive down what are still comparatively high US rates. Barring a global recession, it does seems that long-term interest rates should move higher as the Fed reduces its portfolio and as the risks in the US deficit and debt come to the fore.

Doubleline’s Jeffrey Gundlach made a compelling case for higher long-term rates on CNBC this past week.

Gundlach's view prompted an interesting discussions on CNBC's Options Action, one of the very few shows on CNBC that is actually worth watching. Mike Khouw and Dan Nathan suggested that a trading opportunity exists in the market’s complacency. Interestingly, Carter Worth, one of the traders, and many others, still believe that the 10-year goes to 2.00% here.

I wouldn't advise betting through market instrumnets one way on another on the direction of interest rates here. But, I’d heed the advice of Gundlach and others not to become too complacent about lower rates. Therefore, if you are thinking about remortgaging or locking in a home equity loan, this is as good of a time as any to take action.

Every year, homeowners take out billions of dollars in home equity loans and equity lines of credit – and why not? Home equity loans are a great way to tap into the value of your home so you can afford some of life's major expenses, like a home upgrade or remodel, college tuition or a wedding. Many people use home equity loans to consolidate high-interest debts like credit cards and unsecured personal loans. But before you start filling out applications, there are a few things you should do to ensure you're positioned to get the best loan at the best rate possible. Read on to see what you should be doing right now to get the most from your loan:

First, check your credit. If you're applying for a home equity loan - or any type of loan or credit - the first thing you should do is check your credit report. Your credit report is used to determine your credit score – and your score, in turn, can determine whether or not you qualify for a loan. Federal law entitles you to a free credit report every 12 months from each of the three major credit reporting agencies – TransUnion, Experian and Equifax. All you have to do to request yours is to go to a free credit report site (like AnnualCreditReport.com) and download them. Once you have your copies, review them carefully, looking for any errors. Even minor errors may have an impact on your credit score, so be vigilant in your review. If you find an error in the way an account is reported – for instance, incorrect reporting of a late payment or collections report – be sure to contact the creditor immediately to request a correction.

Next, take some time to boost your credit score. Your credit score is based on the information in your credit report. That means that in addition to correcting errors, there are some other things you should be doing to make your report - and your score - as positive as possible. Ideally, you'll begin repairing your credit a few months before you apply for a loan, but even if you only have a month or so, you can still boost your score by a couple points with just a few changes in your buying behavior. Make sure you pay all your bills on time, and if you're over your limit or concerned you'll be late on a payment, call your creditor to let them know and make arrangements so it doesn't appear as a late payment. If you can, pay down the balances on your credit cards; if you're at or near your limits, your credit score will suffer. Ideally, you want to be below 20 percent of a card's limits, but if that's not doable, any decrease in your outstanding balance can help boost your score. Most importantly, if you carry a large balance, avoid using your card during the loan process – and don't take out any new lines of credit until after you receive your loan proceeds.

While you're improving your credit report and score, you should also be improving your home to make sure your home appraises for its full value. Why? Because the appraisal of your home's value will play a big role in determining the size of your home equity loan and the amount of equity you can tap into. It just makes sense to ensure your home looks its best when the appraiser comes to call. Of course, if you're taking out a home equity loan, chances are you don't have a lot of money to spend on major home improvements. But the good news is, you don't have to sink a lot of money into your home to impress your appraiser. Simple things like washing woodwork and walls, deep-cleaning your rooms, renting a carpet cleaning machine, putting some potted plants on your front porch and making sure minor repairs are made can help your home make the best impression during your appraisal.

And finally, know how much money you really need. When interest rates are low or your appraisal is high, it's tempting to take out a loan that's far in excess of what you really need. That can mean you wind up overextending yourself and getting in over your head when it comes time to make payments. To make sure you don't wind up in financial hot water, make a plan for how you're going to use your loan proceeds, including how much you really need to meet those goals – and then stick with it. That means if you're intending to use your loan to pay for tuition, avoid the temptation to slip in a vacation – even if you feel it's well-deserved. Having a plan and knowing your limits are two important steps in responsible – and smart – borrowing.

That's it – four simple steps are all it takes to make sure your home equity loan process is as rewarding and stress-free as possible. Take a few moments right now to get started, and soon you'll be on your way to making your financial dreams and goals come true.

See the best home equity rates where you live.

While both sources of financing - home equity lines of credit and credit cards - are revolving, or open-ended, and therefore can be used for the same types of expenses, it is important to know the differences between them so you can use them as wisely as possible.

Similarities

The similarities between home equity lines of credit and credit cards include:

• They are open-ended. With both home equity lines of credit and credit cards, you have ongoing access to your funds. Therefore, you can use both of them to finance ongoing expenses.
• They have special rates. Both credit cards and home equity lines of credit can offer low introductory rates.
• They have variable interest rates. On most credit cards and HELOCs, the interest rate is variable. That means that it is tied to a specific index; in most cases prime is used. When prime drops, your interest rate drops, and when it goes up, the rate goes up.
• They have card offers. Obviously, when you have a credit card, it is the medium through which you access your credit. Similarly, with a home equity line of credit, you have the option of getting a card to access your line of credit. Typically, HELOC usage is by writing a check.

Differences

Following are some of the differences between home equity lines of credit and credit cards:

• Limitations. Most HELOCs have a specific period in which funds can be accessed, whereas credit cards do not. All HELOCs and credit cards are subject to cancellation based on payment history.

• Lower interest rates. The interest rates on home equity lines of credit are typically lower than those on credit cards after any introductory period.
• Tax benefits. The interest on a home equity line of credit is usually tax-deductible, whereas that on a credit card is usually not.

Do's

• Many consumers use their equity to help fund their children's college education. This is ordinary perceived to be a good use of it because it is a good investment in their future.
• Another very popular use of a home equity line of credit is to finance a home improvement or renovation project. The benefit of having access to your funds can be combined with the benefit of putting money into your house and increasing its value and its equity for future use.

Don't's

• You should not use your home equity line of credit for frivolous expenses. Some HELOCs have a minimum advance requirement, resulting in an inability to make everyday purchases with your line of credit. Also, most credit cards offer rewards programs, and HELOCs do not. Therefore, let your credit card cover everyday expenses and earn rewards, and use your HELOC for large purchases.
• Because of the favorable interest rates and tax savings, some people advise using a home equity line of credit to pay off high-interest credit card debt. If you find yourself not paying your credit card in full each month, then it might be wise to use your home equity line of credit to consolidate and pay off your debt. Be careful - once you pay off your credit card debt, do not run it up again. If you are going to pay off your debt, and stay debt-free, then using your home's equity is a good way to go. But do not take this route if there is a chance you will find yourself in credit card debt again.

Have you taken out a home equity line or loan? If so, you've joined millions of others who have borrowed against their home's values. As the NY Times reports, over the last twenty years, home equity lines and loans have exploded in popularity:

"Since the early 1980s, the value of home equity loans outstanding has ballooned to more than $1 trillion from $1 billion, and nearly a quarter of Americans with first mortgages have them. That explosive growth has been a boon for banks. Banks’ returns on fixed-rate home equity loans and lines of credit, which are the most popular, are 25 percent to 50 percent higher than returns on consumer loans over all, with much of that premium coming from relatively high fees."

Unfortunately, with home prices falling and the economy softening, all of this debt is hurting many households.

"The portion of people who have home equity lines more than 30 days past due stands 55 percent above its average since the American Bankers Association began tracking it around 1990; delinquencies on home equity loans are 45 percent higher. Hundreds of thousands are delinquent, owing banks more than $10 billion on these loans, often on top of their first mortgages.

None of this would have been possible without a conscious effort by lenders, who have spent billions of dollars in advertising to change the language of home loans and with it Americans’ attitudes toward debt."

I worked at a large bank in the mid-2000s and remember the marketing machine that was put together to push these products out the door. Banks consciously targeted consumers, changing the name of the product from second mortgage to home equity to make it more palpable to consumers. There were television commercials, sophisticated direct mail programs, credit scoring, and all kinds of programs to sell and cross-sell home equities to as many customers as possible.

That being said, the banks never lied about the product. Consumers knew what they were getting themselves into and really didn't care about the risks. When the bank tried to provide customers with financial guidance and education on debt management, most consumers were only mildly interested . Many of my friends eagerly opened home equity lines and loans, seeing it as found money. So, who's to blame? The banks who pushed the product, or the consumers who eagerly gobbled it up?

The Times article quotes Sendhil Mullainathan, an economist at Harvard who has studied persuasion in financial advertising as saying:

“It’s very difficult for one advertiser to come to you and change your perspective. But as it becomes socially acceptable for everyone to accumulate debt, everyone does.”

I personally think that as the government racked up billion dollar deficits throughout the 80s and 90s, the concept of fiscal prudence and responsibility went out the door. Home owners who were once accustomed to paying down their mortgage now saw it as a source of borrowing power and like the government, tapped that source. Banks were only too eager to jump upon the bandwagon and fan the flames with some advertising lighter fluid.