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How much would a $30,000 home equity loan cost each month?
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Are you in need of a large sum of money? You could access the money you need in a variety of ways. However, when you borrow money, it’s important to consider the cost of the financial product you use to do so. Some, like credit cards and personal loans, can come with high interest rates and other fees while others, like home equity loans, can offer more competitive interest rates, reducing your cost of borrowing.
But, there’s a tradeoff to consider. Unlike unsecured lending options that typically come with high interest rates, home equity loans are secured by your home. So, if you don’t make the home equity loan payments you agreed to, you could be risking your home. With that in mind, it’s important to be sure you can afford your payments before you take out a home equity loan.
But, what if you need to get your hands on $30,000? Since the average American homeowner has about ten times that amount in equity in their homes, a home equity loan may be a viable option. But, how much would that loan cost per month? For homeowners considering accessing this amount of equity, it helps to know exactly what their payments will be.
Compare your home equity loan options now.
How much would a $30,000 home equity loan cost each month?
When you take out a home equity loan, there are a few factors that dictate how much your payments will be. Loans for higher values will typically cost more monthly than loans with lower values. Interest rates and terms also play a meaningful role in the monthly cost of home equity loans.
Today’s 10- and 15-year home equity loans come with average interest rates of 8.77% and 8.75%, respectively. Here’s how much money you would need to pay per month on a $30,000 home equity loan at those rates:
- 10-year home equity loan at 8.77%: Your monthly payment on this loan would be $376.30. If you made minimum payments over the life of the 10-year loan, your total interest expense would be $15,156.38 – for a total payoff cost of $45,156.38.
- 15-year home equity loan at 8.75%: If you chose the 15-year home equity loan option with an 8.75% interest rate, your monthly payments would be $299.83 and your total interest cost would be $23,970.23. That brings your total payoff cost to $53,970.23.
Based on these numbers, if you’re looking for the lowest monthly payment possible, you should choose a 15-year home equity loan. On the other hand, if you’re interested in long-term savings and can afford a higher monthly payment, the 10-year home equity loan would be your better option.
There’s a third option to consider, too: a home equity line of credit (HELOC). HELOCs come with variable interest rates and payments that may change based on the overall interest rate environment. And, that could be good news considering the high interest rates of today. If you open a HELOC, and interest rates fall, you could experience savings when compared to traditional home equity loans.
The average HELOC interest rate is currently 9.16%. If you took out a HELOC, and your interest rate remained the same for the life of the credit line (with a 15-year repayment period), you would pay $307.14 per month. Your total interest expense would be $25,285.56, and your total payoff cost would be $55,285.56. But, it’s unlikely that your interest rate would stay the same for the life of the credit line. And, while interest rates may fall ahead, they could also increase. So, only choose this option if you can afford a potentially higher payment in the future.
Tap into your home equity to access the money you need today.
Smart reasons to take out a $30,000 home equity loan now
There are several smart reasons it may be wise to take out a $30,000 home equity loan:
- To cover summertime home repairs: If your home needs summertime repairs or renovations, a home equity loan could provide the funding you need to cover the cost of those repairs. And, using a home equity loan for this purpose could result in tax benefits.
- To help with the down payment on a second home or investment property: If you’ve dreamt of owning a second home or would like to purchase an investment property, you may need to make a large down payment. So, a $30,000 home equity loan could come in handy.
- To help pay for college: It’s wise to further your education, but doing so can also be costly. A $30,000 home equity loan could help you cover the cost of a college degree.
Tap into your home equity now to cover these and other potential expenses.
The bottom line
A $30,000 home equity loan will typically cost anywhere from $299.83 to $376.30 per month, depending on whether you choose a 10-year or 15-year term. As you decide which term works best for you, consider your short- and long-term goals. Keep in mind that while a 15-year term may offer lower monthly payments, it may lead to a much higher interest expense in the end. Compare your home equity loan options today.
Americans are expected to spend more money heating their homes this winter than on holiday gifts, according to new research.
The elevated cost of staying warm indoors amid cold outdoor temperatures comes after an unusually hot summer, that led to households spending bigger shares of their budgets on cooling costs, compared with previous years, according to a report from the National Energy Assistance Directors Association (NEADA).
On average, spending on home heating this winter is projected to increase by 8.7% to $941, up from $866 last winter. The increased costs are attributed in part to both expected colder temperatures in the Northeast and Midwest states.
The new average expenditure on heating costs outpaces the $902 the average household is expected to spend on Christmas presents this year, according to a forecast from the National Retail Federation.
What’s driving up home heating costs?
There are different ways to keep residences warm. Families that use electricity to heat their homes are expected to face the largest increase in costs — more than 14% — which will bring the total up to $1,189 from $1,040 from mid-November through mid-March, which NEADA considers to be the winter period.
Driving up prices is the rising cost of updating and maintaining the electric grid. Plus, colder weather is expected to lead to increased consumption.
“It’s colder, and the cost of electricity is up as the grid is rebuilt. So we’re seeing both higher prices and greater usage,” NEADA Executive Director Mark Wolfe told CBS MoneyWatch.
Natural gas, propane and heating oil cost differences
Natural gas and propane users are also expected to be hit with bigger bills this winter. Heating costs for natural gas are up just over 3%, for an average cost of $634 for the winter period, compared with $615 for 2023-2024. Costs are expected to rise only modestly in line with wholesale prices.
Propane costs are up 4.4%, with families expected to spend an average of $1,231 heating homes, up from $1,179 last season.
Heating oil costs, by contrast, have declined 2.7%, which means average spending this winter will be $1,518, down from $1,560 last winter.
Early start to the season
November was colder than usual, with temperatures dropping prematurely after a “very expensive summer” of heat waves straining cooling resources, said Wolfe.
Blame climate change for the big swings in temperature, he added.
“Weather conditions can be very unpredictable even though over time, winters are getting warmer and summers are getting hotter. It’s not a straight line, and for consumers, it’s quite upsetting because higher utility bills are coming right before Christmas,” Wolfe said.
Steps to take now
There are steps consumers can take to help keep a lid on home heating costs.
Wolfe urges people to have their thermostats serviced now, before the coldest temperatures of the season roll in. That way, families won’t be on the hook for an emergency repair if their thermostat breaks in the middle of a cold front. A tune-up will also help heating systems run more efficiently, he said.
Always close the furnace flue, or else it will lead heat outside the house, advises Wolfe. Lastly, manually turn down the heat at night, if you can, to save up to 10% on your energy bill.
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There’s still time to become a mega-millionaire for Christmas, but lady luck will have to be on your side.
No one matched Mega Millions‘ all six winning numbers last Tuesday, and the jackpot now stands at $862 million ahead of Friday night’s drawing.
The jackpot has been rolling since it was last won at $810 million in Texas on Sept. 10.
If there is a sole winner, they have a choice between an annuity, with an initial payment and then 29 annual payments, or a one-time lump sum payment. Most winners choose a cash payout.
For Friday night’s drawing, that would be an estimated $392.1 million before taxes.
If won at that level, it would be the largest prize ever won in December and the seventh largest in Mega Millions history.
According to Mega Millions, 13 jackpots have been won during December since the game began in 2002. Three were won in the days after Christmas, while the other 10 were won before Christmas. There has never been a jackpot win on Christmas Day, although over the years drawings have been conducted on Christmas six times – in 2007, 2009, 2012, 2015, 2018 and 2020.
Mega Millions drawings are held on Tuesday and Friday, tickets cost $2. The odds of winning the jackpot are about 1 in 303 million.
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Here’s how much more it will cost to heat your home this winter
18-year-old from North Dakota charged in north Minneapolis shooting that killed teen girl