With homeowners sitting on record levels of accessible home equity, withdrawals from home equity lines of credit (HELOCs) during the first three months of 2025 reached their highest first-quarter level in 17 years, according to a report released Monday by ICE Mortgage Technology.
ICE reports that despite that surge in withdrawals, U.S. homeowners were still holding $11.5 trillion of “tappable” equity heading into the second calendar quarter, which means home equity that is available to borrow while still maintaining a minimum 20% equity cushion.
Andy Walden, head of mortgage and housing market research at ICE, thinks that HELOC withdrawals may increase further this year if the Federal Reserve lowers borrowing costs by cutting the benchmark federal funds rate.
“Equity levels remain historically high, and now we’re seeing the cost of borrowing against that equity drop meaningfully,” Walden said in a press release. “The monthly payment needed to withdraw $50,000 via a home equity line of credit has fallen by more than $100 since early 2024. If the Fed moves forward with anticipated rate cuts, borrowing against home equity could become even more attractive in the second half of the year.”
The ICE report notes that the average introductory rate on second lien HELOCs dipped below 7.5% in March. The mortgage data company thinks those rates could fall to the mid-6% range by 2026, which is roughly in line with where ICE projects 30-year mortgage rates will settle, based on the implied rates of mortgage futures contracts.
About 48 million mortgage holders in the U.S. have tappable equity, according to ICE, with the typical homeowner having around $212,000 accessible. Meanwhile, about a quarter of borrowers surveyed by ICE said they are considering tapping into their home’s equity via a HELOC or another form of home equity loan.
“Roughly 25% of homeowners said they are considering a home equity loan or HELOC in the next year,” said Tim Bowler, president of ICE Mortgage Technology. “It’s periods like these — where both demand and affordability trends converge — that represent a critical opportunity for housing finance professionals to earn homeowners’ repeat business.”
