Home equity loans and home equity lines of credit (HELOCs) allow borrowers to tap into the equity in their homes. With a home equity loan, homeowners can access funds in a lump sum, while a HELOC offers them the ability to borrow as needed from a line of credit, up to a set limit. Traditionally, both home equity and HELOC rates have been affordable because they’re secured debts, which means there’s lower risk for lenders. 

However, as inflation surged in the post-pandemic era and the Federal Reserve raised interest rates in response, home equity borrowing rates climbed to their highest level in years. Those high borrowing costs couldn’t last forever, though. The Federal Reserve cut rates in September for the first time in years, and predictions of home equity loan rate drops in the summer of 2024 came true. 

Declining rates left some borrowers wondering if they should get a home equity loan in 2024,  while others have been waiting for interest rate forecasts for the fall to help them decide if additional savings will be available after another rate drop. There’s also the question of whether a home equity loan or line of credit is preferable as rates decline. 

Compare today’s top home equity borrowing rates here.

Will home equity loan interest rates fall in November?

If you’re waiting for a chance to borrow against your home with an affordable loan, here’s what experts say about where home equity rates will trend in November. 

Some experts believe rates will fall in November

For homebuyers eager to borrow, the good news is that plenty of experts believe November will bring another rate cut for home equity loans — although not a substantial one. 

“Home equity loan interest rates will likely trend slightly downward in November, but not dramatically,” J.R. George, senior vice president of Trustco Bank, says. 

George notes that the next Federal Open Market Committee meeting will take place in November and “provide a clearer picture of what’s in store.”

“The Fed is predicted to cut rates by 75-100 basis points,” George says.” This would start to bring mortgage rates down.”

Danielle Hale, Realtor.com’s chief economist, agrees. 

“Home equity loan interest rates tend to move more directly in conjunction with the Federal Funds rate. As a result, it’s highly likely that they will drop in November as the Fed is widely expected to cut its policy rate at its meeting that concludes November,” Hale says. 

With the next Fed meeting scheduled for November 6 to November 7, those eager to see the impact of the Fed rate cut on home equity borrowing rates won’t have long to wait.

Find out what home equity loan rates are available to you now.

Others warn that promised rate cuts may not pan out

While some experts believe the Fed’s actions will cause rates to move this month, others are skeptical as to whether the promised rate cut will occur. 

“Since it is so close to the election, there’s a good chance that the Fed will leave rates where they are until December. If that is the case, then these rates should remain flat through November,” says Sarah Alvarez, vice president of mortgage banking at William Raveis Mortgage.  

Aaron Gordon, branch manager and senior mortgage loan officer at Guild Mortgage, agrees that a rate cut may not occur, or may be smaller than expected — which could result in home equity loan rates remaining stable throughout the month.

“Recent events showing that the economy is continuing to expand make it seem like the Fed could pause additional rate drops in November,” Gordon says. “They had been expected to drop their rate by 25 to 50 basis points. My guess is they will still drop their rate by 25 basis points, which will mean a small drop in home equity loan rates.”

While Fed officials signaled that more cuts would be coming in 2024, this wouldn’t be the first time that an expected drop in rates didn’t pan out. 

In fact, many experts predicted the Fed would begin cutting rates earlier in 2024 rather than waiting until the September meeting. Fed officials have also made clear that any future rate cuts are dependent on inflation and other economic factors. 

The bottom line

Borrowers hoping for cheaper ways to tap their equity will likely be disappointed at this news. Still, the fact remains that rates are lower than they were during the recent peak and, even if they don’t decline in November, the Fed is likely to make further cuts through 2025 so lower-cost borrowing opportunities aren’t too far off.