CBS News
Should you open a home equity loan now or wait until 2025?
With cost-effective borrowing options rare in recent years, one alternative has surfaced as more advantageous for homeowners: accessing their home equity. Whether via a home equity loan or a home equity line of credit (HELOC), both products offer homeowners an effective way to access their accumulated home equity without having to refinance. And, right now, the amount of money that can be tapped into is large, with the average home equity amount hovering close to $330,000 and likely to rise even further as home prices continue to grow.
So accessing this money with a home equity loan, which comes with a fixed (and lower) interest rate compared to a HELOC, makes sense for many borrowers. The timing, however, needs to be carefully considered. Specifically, is it worth opening a home equity loan now or are borrowers better served by waiting for interest rates to decline further into 2025? That’s what we’ll break down below.
See what home equity loan rate you could qualify for here.
Should you open a home equity loan now or wait until 2025?
There’s a compelling case to be made for opening a home equity loan now versus waiting until the new year. Here’s why:
Interest rates are already lower than many alternatives
If you need money now, then this is likely your best option. That’s because interest rates on home equity loans, averaging around 8.40% right now, are already much lower than some popular alternatives. Average credit card interest rates, for instance, just hit a record, surpassing 23%.
Personal loans, meanwhile, are much lower at around 13% – but that’s still more than four points higher than home equity loans. And that difference could prove to be worth thousands of dollars when spread out over a 10 or 15-year repayment period. Understanding the drawbacks of the alternatives, then, it makes sense to lock in a home equity loan rate now, before it has a chance to change in 2025.
Get started with a home equity loan online now.
There’s no guarantee that rates will decline much further
The price of gold was on a record rise all of 2024 … until it wasn’t. Mortgage rates had plunged to a 2-year low in September … until rising more than a point in October. As these two recent developments demonstrate, the economy and financial markets are constantly evolving. And while inflation and home equity loan interest rates, specifically, could continue to decline in December and into 2025 there’s no guarantee that they will.
And as homebuyers recently experienced, they could even rise, perhaps by a prohibitive margin. Monitoring this dynamic, then, many potential home equity borrowers may be better served by locking in a low home equity loan rate now – and refinancing it should rates drop significantly in the future.
Waiting delays a major tax deduction
While the interest rate you pay on any product is a critical consideration, it may not be quite as important for home equity loans if you use it for IRS-eligible home repairs and improvements. That’s because the interest you pay on these loans is tax-deductible if used for specific home projects.
Waiting to secure the loan, then, will delay this potentially major tax deduction, leaving homeowners stuck with the interest until they can deduct it from their 2025 return – which they’ll file in 2026. Acting now, however, could potentially reduce your 2024 tax bill, even with just seven weeks left on the calendar.
Learn more about your home equity loan interest tax deductions here.
The bottom line
For some homeowners, waiting until 2025 to formally apply for a home equity loan makes sense. For others, however, it’s more beneficial to act now. Interest rates on this unique product are already much lower than popular alternatives and there’s no guarantee that rates will fall much further anyway. Plus, by acting now, homeowners can position themselves to potentially benefit from a major interest deduction on their taxes. Still, home equity loans are largely cheaper because the home in question is used as collateral. So borrowers will need to take a strategic approach to this loan type, no matter if they apply now or at a later date in 2025.
CBS News
Democratic Congressman on the party’s messaging, focus
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
CBS News
11/13: The Daily Report – CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
CBS News
Opioid overdose deaths drop for 12th straight month, now lowest since 2020
Opioid overdose deaths have now slowed to the lowest levels nationwide since 2020, according to new estimates from the Centers for Disease Control and Prevention. This marks the 12th straight month of decline since a peak last year.
Around 70,655 deaths linked to opioids like heroin and fentanyl were reported for the year ending June 2024, the CDC now estimates, falling 18% from the same time in 2023.
Almost all states, except for a handful in the West from Alaska through Nevada, are now seeing a significant decrease in overdose death rates. Early data from Canada also suggests overdose deaths there might now be slowing off of a peak in 2023 too.
“While these data are cause for optimism, we must not lose sight of the fact that nearly 100,000 people are still estimated to be dying annually from drug overdose in the U.S.” said Dr. Nora Volkow, director of the National Institute on Drug Abuse, in a statement.
Other types of drug overdoses beyond opioids are also slowing. While they make up a smaller share of overall deaths, overdoses linked to drugs like methamphetamine and cocaine are also showing signs of dropping nationwide following a peak last year.
“We are encouraged by this data, but boy, it is time to double down on the things that we know are working. It is not a time to pull back, and I feel very strongly, and our data shows, that the threat continues to evolve,” Dr. Allison Arwady, head of the CDC’s National Center for Injury Prevention and Control, told CBS News.
Arwady pointed to a long list of factors that officials hope are contributing to the decline, ranging from broader availability of the overdose reversing spray naloxone, also known as Narcan, to efforts to ease gaps in access to medications that can treat opioid use disorder.
Trends in what health officials call “primary prevention” have also improved in recent years — meaning fewer people using the drugs to begin with. As an example, Arwady cited CDC surveys showing a clear decline in high school students reporting that they have tried illegal drugs.
The CDC and health departments have also gotten faster at gathering and analyzing data to respond to surges in overdoses, Arwady said, often caused by new so-called “adulterants” that are mixed in. Health authorities study this by testing blood and drug samples taken in the wake of surges, in search of potential emerging drug threats.
Agency researchers are now looking closer at what could be behind gaps in communities that are still not seeing slowdowns, Arwady said.
“Unfortunately, for the most affected groups, namely Native Americans and Black American men, the death rates are not decreasing and are at the highest recorded levels,” said Volkow.
Why are drug overdose deaths declining?
In the months since CDC data first began showing real signs of a nationwide change to the deadly record wave of opioid overdose deaths, experts have floated a number of theories to explain what caused the change.
“We had been seeing the numbers go down, on the national aggregate level, since last April, and we were skeptical and kind of holding our tongues. Then we started hearing from a lot of folks on the ground, frontline providers,'” said Nabarun Dasgupta, a senior scientist at the University of North Carolina Chapel Hill who studies opioid overdose deaths.
Dasgupta led an analysis in September by the university’s Opioid Data Lab illustrating the nationwide scope of the downturn and probing a number of theories that might explain it.
Some explanations they dismissed as unlikely, like stepped-up law enforcement operations. Other ideas they judged as plausible, but complicated to prove, like a so-called “depletion of susceptibles” — essentially the epidemic burning itself out, as users either found ways to survive the influx of fentanyl or died — or the wider availability of naloxone.
Dasgupta said they received a flood of interest since their initial post proposing more theories, like new scanners that were deployed on the U.S.-Mexico border.
There are likely a number of factors all playing a role in the shift, Dasgupta says. But he said early data from research they are wrapping up now supports one leading explanation: a shift in the illegal drug supply.
“Our hypothesis is that something has changed in the drug supply. This kind of pronounced shift, something that happens suddenly, if numbers had suddenly shot up, we would definitely be pointing to a change in the drug supply to explain it,” said Dasgupta.
Amid its downsides, xylazine‘s rise might have led to less injection drug use, they speculate. Its longer high could also be reducing the number of times people use fentanyl each day.
“We’re not in our offices celebrating. We’re still losing too many people that we love. So I just want it to be very clear that with like a hundred thousand people still dying, that’s obscenely high,” he said.