Small Home Equity Loans: What’s the Minimum Amount You Can Borrow?

A small home equity loan or HELOC lets you access funds without borrowing more than you need, keeping your payments manageable. Aven offers the lowest HELOC minimum we found, at just $5,000, making it ideal for tackling smaller projects or financial goals.

Below, we highlight lenders offering home equity loans with minimums of $15,000 or less to help you find the right fit for your needs.

Reviews of 4 lenders offering small home equity loans

If you’re considering a smaller home equity loan, understand how the minimum borrowing limits work. We’ve researched borrowing options for small home equity loans and HELOCs. Here’s what to consider in your decision-making.

Figure

Best HELOC

4.9 _/5

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Why we picked it

Figure might be ideal if you need a HELOC of at least $15,000. 

It boasts a seamless online application process that takes just minutes. Once approved, you can get your funds in as little as five days. This speed is impressive and can be crucial for time-sensitive needs. 

Figure doesn’t assess prepayment penalties, allowing you to pay off your loan early without extra costs. With Figure, you can redraw up to 100% of your line of credit, offering maximum flexibility and control over your finances.

• Quick online application process
• Funding as fast as 5 days
• No prepayment penalties
• Redraw up to 100%

• Must draw the full credit line (minus fees) at closing

HELOC details

Rates (APR)	7.70% – 16.80%
Loan amounts	$15,000 – $400,000
Repayment terms	5, 10, 15, or 30 years
Min. credit score	640

Aven

Best Customer Reviews

4.8 _/5

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Why we picked it

Aven offers the lowest minimum HELOC we found at just $5,000, making it an excellent choice for homeowners who need a smaller line of credit. This low entry point allows you to access funds for minor home repairs, debt consolidation, or other small expenses without overcommitting to a larger loan.

Aven’s straightforward application process and flexible terms make it a practical option for those looking to borrow only what they need, keeping interest costs and monthly payments down.

• Lowest rate guarantee
• Optional debt protection program through Securian
• Approval in as little as 15 minutes
• Excellent Trustpilot customer reviews from more than 3,800 customers (in September 2024)
• 100% digital application process
• Increases credit line for select customers

• Short draw period
• First-draw fee of 4.90%
• Only available in 32 states*

HELOC details

Rates (APR)	6.99% – 15.49%
Loan amounts	$5,000 – $400,000
Repayment terms	5, 10, 15, or 30 years
Min. credit score	640
Funding time	As little as 3 days after signing

Bethpage FCU

Best Credit Union

4.7 _/5

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Why we picked it

Bethpage Federal Credit Union offers excellent small HELOC options with a low fixed rate for creditworthy borrowers for the first 12 months. 

As a credit union, it can provide better terms than traditional banks. One notable feature is that no closing costs make it more affordable upfront. 

With Bethpage FCU, you also enjoy flexible borrowing options tailored to your needs. This flexibility and favorable terms make it a top choice for a small HELOC.

• Competitive interest rates
• No closing costs
• Flexible borrowing

• Membership required
• Limited branch locations

HELOC details

Rates (APR)	12-month introductory rate starting at 6.99% for VantageScores of 720 and up, with variable post-introductory rates starting at 8.00%
Loan amounts	$10,000 – $1 million
Repayment terms	20 years
Min. credit score	670

LendingTree

Best for Comparison Shopping

4.5 _/5

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Why we picked it

LendingTree allows consumers to review multiple lending options at once. You can submit information and get multiple options for home equity loans or HELOCs in one day. 

Because LendingTree provides so many options, it gets our vote for the best marketplace.

• Compare multiple lenders in a few minutes
• Initial soft pull won’t negatively affect your credit.
• Quick initial application to find lenders

• Does not include every lender available in the marketplace
• Giving your phone number might lead to lender calls

Loan details

Rates (APR)	Starts at 6.88%
Loan amounts	$10,000 – $2 million
Repayment terms	Vary depending on lender
Min. credit score	Varies depending on lender

What is the smallest home equity loan I’m eligible for? 

The minimum amount for home equity loans varies by lender.

To qualify for a home equity loan, you must meet other requirements, such as maintaining 15% to 20% equity in your home after the loan is funded. Lenders also consider your credit score, income, and debt-to-income ratio when determining whether to issue you a loan. 

In sum, lenders determine how much you can borrow by assessing the value of your home, the amount of equity you have, and your financial situation.

How to calculate loan-to-value ratio

Another factor lenders consider when determining your eligibility is your loan-to-value ratio (LTV). Many lenders require a combined LTV of 80% or 85%. Combined LTV is the ratio of all loans securing the home (including the primary mortgage and home equity loans) to the property value.

Here’s an example of how this might work.

• Appraised home value: $350,000
• Outstanding mortgage balance: $255,000
• Desired home equity loan: $25,000

To calculate the combined LTV:

Sum of loans: $255,000 (mortgage) + $25,000 (home equity loan) = $280,000

Combined LTV: $280,000 / $350,000 = 0.8 (or 80%)

In this example, your combined LTV would be 80%, which is acceptable for many lenders.

Small home equity loans vs. small HELOCs

With a home equity loan, you get a lump sum payment and repay the loan in equal installments for a set term. With a HELOC, you can access a specific line of credit, but the rate is typically variable. With some lenders, you can take out HELOC money in increments. However, with others,—including Figure and Aven—you must withdraw 100% of your credit line at closing.

Aven’s minimum starts at $5,000. Bethpage allows you to withdraw a minimum of $10,000, and Figure’s minimum for a HELOC is $15,000. On LendingTree, you can compare multiple lenders through the marketplace, but many have minimums of $10,000 to $20,000.

Which is better: a small home equity loan or a small HELOC?

The lending product that’s best for you depends on your goals. For example, a HELOC might be preferable if you’re completing a renovation because you can withdraw funds as you need it. That means you can start with a small amount and borrow more as needed (provided your lender doesn’t require you to withdraw all your funds at closing.)

HELOC	Home equity loan
Withdraw funds as needed	Lump sum upfront
Variable rate is most common	Fixed rate is most common

With a home equity loan, you should have a clear purpose for withdrawing the money—for example, consolidating high-interest debt—and know the amount you need since you borrow funds all at once. 

Ultimately, which is best for you—home equity loan vs. HELOC—depends on the lending offers you receive, the terms, and the reasons you want to tap into your equity.

Why do lenders set home equity loan minimum amounts?

Lenders set minimum limits on home equity loans to ensure they recoup their investment in the loan. The lender incurs upfront costs to grant a home equity loan. They earn back those costs plus a rate of return as you repay the loan with interest.

Lenders enforce minimums because a home equity loan that’s too small could prevent them from recovering those costs or making a profit. 

The minimum loan amount may be your primary consideration when comparing small home equity loans. Still, we urge you to consider the bigger picture and weigh the following:

• Interest rates and the lowest rate you can qualify for
• Loan repayment terms
• Loan fees you’ll pay
• What you’ll need to qualify

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Tip

If you opt for a shorter repayment term, you can save money on the total interest paid. A home equity loan or HELOC interest may be tax-deductible if it’s used to improve your home and if you itemize deductions.

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How to get a small home equity loan or HELOC

The steps to apply for a home equity line of credit and a home equity loan are similar. Here’s how to apply for either of these financing options.

1. Calculate your home equity: Subtract what you owe on your home from its current market value. If you need help determining market value, speak with a qualified real estate agent. You may need 15% to 20% equity to qualify for a home equity loan or HELOC.
2. Pull your credit report: Before researching lenders, pull your credit report for free from AnnualCreditReport. Ensure there are no errors or adverse accounts on your report that could damage your score.
3. Research lenders and prequalify: Research lenders that offer small minimum balances on home equity lending products. Prequalify with at least three different lenders to compare rates and terms.
4. Choose a lender and apply: After reviewing your prequalification offers, choose a lender and complete a full application. Your lender will likely need income information, property information, and other documents, like tax returns.
5. Complete a home appraisal: Most lenders will order a formal home appraisal to determine the current value of your home.
6. Get funded: Once you’re approved and your home appraisal is complete, you’ll get a closing date, similar to closing on your first mortgage. Once you complete closing, you’ll get access to the funds you requested.

Alternatives to home equity loans for less than $15,000

Because your home secures a home equity loan, using the proceeds to pay for expenses with no tangible return might not make sense. For example, your lender might not prohibit you from using a home equity loan to pay for a dream vacation, but is it worth risking your house? 

Home equity loans are just one way to borrow. Consider credit cards or a personal loan to meet your funding needs. Every option has pros and cons, and one may be more appropriate based on your situation. 

Credit cards

Credit cards can be a solution for short-term financing, especially if you can secure a 0% introductory rate and pay your balance in full before interest accrues. Credit cards are beneficial because no collateral is required, and you can get approved the same day. 

The drawbacks are that credit cards have higher interest rates than HELOCs, and many come with extra costs, such as annual fees and late fees. Like HELOCs, credit cards have set limits, but unlike HELOCs, many credit cards also offer points and rewards.

Personal loans

Personal loans can be secured by a bank account or other collateral, but unsecured personal loans are more common. Lenders may offer personal loans for as little as $500 and as much as $100,000. Most personal loans have terms between two and seven years, but shorter terms are sometimes an option.

The benefit of an unsecured personal loan is that you can often apply online and receive funds in a few days. The downside is personal loans often have higher interest rates than home equity loans. However, personal loans might be a better option for people who don’t want to use their home as collateral.

Buy now, pay later

For smaller purchases, buy now, pay later (BNPL) financing could be faster and easier than applying for other types of financing. BNPL is an installment loan available in some online shopping platforms or brick-and-mortar stores.

BNPL options make it quick and easy to finance purchases, especially compared to getting a small home equity loan. However, it’s important to make intentional decisions about BNPL financing. Review interest rates before committing to a BNPL option, as some lenders can charge up to 30% interest for borrowing.

FAQ

Is a HELOC a good option for emergency funds?

In an emergency, you can use a HELOC. However, most financial experts recommend saving at least three months’ worth of expenses in an easily accessible account. That way, you have savings when you need it and don’t have to worry about interest costs and paying it back.

Be sure to inquire whether your lender requires a minimum draw if you are considering securing an HELOC in an emergency. For example, Figure requires borrowers to withdraw 100% of their credit line at closing, so it wouldn’t be a good option for an emergency fund.

How do rate changes affect a HELOC?

Rate changes on variable rate HELOCs will affect your minimum payment and the amount of interest you pay. Lenders are required to set lifetime caps for your HELOC, but they may also have lifetime rate minimums. There may also be periodic rate adjustment caps limiting how much a rate can change. 

How long does it take to get approved for a HELOC?

Getting approved for a HELOC can take a few days to six weeks. Some lenders process applications faster than others. If you need a full home appraisal or apply with a co-borrower or cosigner, this can slow down the process. 

How we selected the best small home equity loans

Since 2018, LendEDU has evaluated home equity companies to help readers find the best home equity loans and HELOCs. Our latest analysis reviewed 850 data points from 34 lenders and financial institutions, with 25 data points collected. This information is gathered from company websites, online applications, public disclosures, customer reviews, and direct communication with company representatives.

These star ratings help us determine which companies are best for different situations. We don’t believe two companies can be the best for the same purpose, so we only show each best-for designation once.

Recap of the best small home equity loans