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Home Equity HELOCs

Chase Home Equity Loan Review

Updated Dec 04, 2023   |   8-min read

Chase is the banking wing of JP Morgan Chase & Co. It is the largest U.S.-based bank in terms of total assets, and almost half of American households have at least one open Chase account. 

It offers financial services to customers in the form of savings and checking accounts, investment accounts, credit cards, auto loans, mortgage loans, and home equity lines of credit (HELOCs). 

However, in late 2020, Chase announced that it would be suspending new HELOC applications as a result of “current market conditions.” It also announced it will be reallocating HELOC resources to home purchase and refinancing transactions instead. 

What happened to Chase home equity loans and HELOCs?

The primary reason Chase elected to suspend new HELOC applications was because of economic uncertainty. When the decision was made in late 2020, the world was still feeling the negative effects of the lockdowns generated by the pandemic and the resulting economic downturn. Chase believed that it needed to mitigate risk with its mortgage-lending operations. 

Suspending new HELOC applications was a natural move for Chase. HELOCs are almost always riskier for banks than new or refinanced mortgages. This is because a HELOC, as a revolving line of credit secured by a home, is essentially a second lien on that home. 

If the borrower defaults and the home forecloses, the original mortgage lender would receive repayment based on the home’s value first. The HELOC issuer (in this case Chase) would be paid only out of the value that remains in the home after the original lender has been paid off. 

If there isn’t enough remaining value in the home to cover the customer’s total balance in the line of credit, the HELOC issuer could stand to lose a substantial amount of money. The risk is even greater during economic recessions, as people have a more difficult time with paying their bills. 

New mortgage standards

This was not the only move that Chase enacted to minimize risk in its mortgage-lending operations. Around the same time it announced the suspension of new HELOC applications, it also dramatically increased its lending standards for new mortgage applicants. 

Originally, Chase’s minimum standards for a mortgage were a FICO score of 620 and a 5% downpayment, but these were increased to a FICO score of 700 and a 20% down payment requirement. 

What if I already have a Chase home equity product?

The move to suspend new HELOC applications did not have any effect on customers who had an existing HELOC with Chase. These customers are still able to withdraw funds from their HELOC accounts if they so choose. The suspension only applies to potential new applicants. 

It’s worth noting that Chase offers many other valuable financial products to customers as well. The bank’s strength lies not just in its home equity options but also in its comprehensive financial portfolio that serves a broad spectrum of needs, including for individuals and businesses deemed to be a higher risk for the bank like HELOC applicants often are. 

For example, if you run your own business, you could consider a high-risk merchant credit card as a way to gain access to credit as an alternative to tapping into your home’s equity. 

A high-risk merchant credit account is intended for businesses that are viewed as high risk by lenders because they are likely to default on making payments. It’s an alternative way for you to gain access to a credit line, although you’ll likely have to pay higher fees in contrast to a standard account. 

Alternatives to Chase home equity products

If you do decide that seeking a home equity loan from another company is the right move for you instead of other high-risk credit options, you have choices from other banks. Here are some options to consider.

LenderWhat it offers
FigureHELOCs from $20,000 – $400,000
LendingTreeMarketplace that matches you to lenders 
HitchHELOCs up to $500,000 or 95% of your home value (applies to Colorado, Florida, Oregon, or Utah)
SpringEQHELOCs and home equity loans between $25,000 – $500,000
Bethpage HELOCs for $10,000 – $1,000,000

Figure

Best overall HELOC

  • Editorial rating: 4.9 out of 5
  • HELOCs ranging from $20,000 to $400,000
  • Fast online approval

Figure is a relatively new fintech company, but it already has developed a solid reputation. Its signature feature for its HELOC loans is its fast approvals (in as little as five minutes) after submitting an application, which can be completely entirely online. 

The company only considers applications that have enough equity in their home to cover the cost of the loan. It also only allows one owner of the home to apply for the loan. This means that you and a co-owner of a home will not be able to apply together. 

Additional factors that Figure takes into strong consideration include your income, assets, credit history, and the condition of your property in addition to its value.

  • Rate discounts: 0.25% discount for making automatic payments 
  • Draw periods: 2 – 5 years
  • Repayment periods: 5 – 30 years
  • Maximum LTV: 85%
  • Minimum credit score: 640
  • Minimum income: Not disclosed
  • Fees: Origination fee of 4.99% of the initial draw

LendingTree

Best marketplace for HELOCs and home equity loans

  • Editorial rating: 4.7 out of 5 (HELOC); 4.9 out of 5 (home equity loan)
  • Allows you to compare multiple lenders quickly
  • Only requires a soft credit pull, so your credit score will not be affected

LendingTree is a marketplace that does not offer HELOCs or home equity loans directly but instead matches you to lenders from its pool of partners. In general, most of its partners are known for allowing you to borrow up to 85% of your home’s equity that you have built up and will want to confirm you have at least a fair credit score.

Arguably the best use for LendingTree is to explore your options for HELOC lenders. After submitting your information, you can quickly compare rates and other details between multiple lenders. Be prepared, however, to receive marketing calls and emails after you have submitted your information from the lenders you’ve prequalified with. 

Terms vary by lender.

Hitch

Best fast-funding HELOC

  • Editorial rating: 4.4 out of 5
  • HELOCs up to $500,000
  • Available to applicants residing in Colorado, Florida, Oregon, or Utah

Recently founded in 2022, Hitch has aimed to set up a short and simple process for its customers to access HELOCs, as well as other kinds of secured loans. 

Hitch accomplishes this thanks to its up-to-date technology and partnerships with other lending partners. The average Hitch HELOC application takes between two and six weeks to finalize, with the funds arriving in approved applicants’ bank accounts just days later. 

The catch is that Hitch is limited to applicants in four states: Colorado, Florida, Oregon, and Utah. If you’re a resident of one of those states, however, Hitch is an option worth exploring for a HELOC. The company is currently in the process of expanding to more states, but has yet to announce which ones.

  • Rate discounts: Up to 0.25% (depending on the lender)
  • Draw periods: 2 to 10 years 
  • Repayment periods: 10 to 30 years
  • Maximum LTV: 95%
  • Minimum credit score: 620
  • Minimum income: One year of verifiable income required 
  • Fees: 2.5% origination fee + up to $50 underwriting fee + up to $800 appraisal fee

SpringEQ

Best multi-product application for HELOCs and home equity loans

  • Editorial rating: 4.3 out of 5 (HELOC); 4.6 out of (home equity loan)
  • Provides HELOCs and home equity loans between $25,000 – $500,000
  • Available for secondary homes and investment properties as well as primary residences

SpringEQ offers both HELOCs and home equity loans to qualifying applicants. Unlike many other lenders, it can also offer HELOCs and equity loans on any secondary homes or investment properties you may have in addition to your primary residence. 

SpringEQ is also well known for its fast approval and funding times, with most transactions with approved applicants being completed within three weeks. 

Take note that SpringEQ currently does not offer its services to residents from Alaska, Hawaii, Idaho, Massachusetts, Missouri, North Dakota, New York, South Dakota, West Virginia, and Wyoming. 

  • Rate discounts: N/A
  • Draw periods: 10 years (HELOC) 
  • Repayment periods: 20 years (HELOC) or 5 – 30 years (home equity loans)
  • Maximum LTV: 95%
  • Minimum credit score: 620
  • Minimum income: Not disclosed
  • Fees: Not disclosed

Bethpage

Best credit union HELOC

  • Editorial rating: 4.2 out of 5
  • HELOCs for $10,000 – $1 million
  • Permits you to convert your HELOC to a fixed-rate plan

Bethpage is a New York-based federal credit union. Currently, the HELOC is the only home equity product that Bethpage has available. What’s unique about Bethpage, however, is that it will allow you to convert part or all of your HELOC into a fixed-rate loan, which is very similar to a traditional home equity loan. 

Unlike many other lenders, Bethpage will allow you to use your home equity for any purpose you desire, so declaring your intended use for the funds is not factored into the approval process. 

  • Rate discounts: 0.25% discount for automatic payments 
  • Draw periods: 10 years
  • Repayment periods: 20 years
  • Maximum LTV: 75%
  • Minimum credit score: 670
  • Minimum income: Not disclosed
  • Fees: No origination, appraisal, or application fees 

FAQ

When will Chase offer a HELOC again?

Chase has not announced when or if it will be offering its HELOC program again. For now, existing approved applicants can still draw out funds, but the program is closed to new applicants. 

Does Chase offer any alternative products to a HELOC or home equity loan?

Chase currently offers a cash-out refinance program as an alternative to a HELOC or home equity loan. Under this program, you can replace your existing mortgage to use equity in your home to receive cash you can spend for other large expenses. There are also currently no restrictions on how you can use the funds under this program 

Can I switch my Chase HELOC to a new lender?

Yes, you can refinance your line of credit with a different bank. The process and requirements will depend on the specific bank you are aiming to refinance with.