TD Bank HELOC Review 2024
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Our Take
4.5
TD Bank stands out for being one of the largest HELOC lenders in the country by origination volume. Borrowers have the option to lock their interest rate on a balance, and rate quotes are customizable online. However, while borrowers can begin a HELOC application online, they must close at a physical branch.
Pros
- Maximum borrowing limit is 89.99%, higher than the industry standard of 80%.
- Rate discount for borrowers with a TD Bank checking account.
- No minimum draw requirement.
Cons
- Borrowers pay a $99 origination fee and a $50 annual fee.
- Borrowers can apply online but must close in person.
- Best rates are reserved for lines of credit starting at $200,000.
Lender | Max. loan amount | Max LTV | Min. credit score | |
|---|---|---|---|---|
$400,000 | 85% | 640 | Visit Lenderat Figure at Figure | |
$750,000 | 80% | 580 | Visit Lenderat New American Funding at New American Funding | |
$350,000 | 80% | 680 | Visit Lenderat Rocket Mortgage, LLC at Rocket Mortgage, LLC |
Full Review
TD Bank HELOC rates
Most home equity line of credit, or HELOC, interest rates are indexed to a base rate called the prime rate. The annual percentage rate, or APR, that you’re offered will include a margin the lender has added to the prime rate. These margins depend largely on factors like your credit score, your existing debt and the amount you wish to borrow, but they will vary by lender.
Current prime rate | Prime rate last week | Prime rate in the past year — low | Prime rate in the past year — high |
|---|---|---|---|
7.75% | 8% | 7.75% | 8.50% |
On the day we checked, the margin ranged from Prime - 0.01% to Prime + 4.44%. Credit lines with a limit of $200,000 or more will qualify for the lowest interest rate. Potential borrowers can enter details such as their credit score range, loan amount and home value to calculate a customized rate estimate online.
Borrowers with a TD Bank checking account may qualify for a HELOC rate discount of 0.25 percentage point.
Borrowers have the option of locking the interest rate for up to three outstanding balances. The minimum balance for fixing the rate is $5,000.
Applying for a TD Bank HELOC
Borrowers can begin their HELOC application online or by phone, but must visit a physical branch to sign paperwork and finalize closing documents. Alternatively, the whole application can be completed in person. Be prepared to provide personal information like your identification and social security number, as well as financial documentation such as bank statements, pay stubs, W-2s and mortgage documents.
Customer support is available in person or by phone. There is a direct line to the home equity lending team, though hours of availability are not posted. When we called, we were connected with a lending specialist who was able to immediately answer our questions.
TD Bank also has a virtual assistant on its website, which connects users with FAQs.
Opening and using a TD Bank HELOC
TD Bank HELOCs have a maximum borrowing limit of 89.99% of the value of your home, minus any remaining mortgage balance. There is a $99 origination fee and a $50 annual fee.
The HELOC has a standard 30-year term, with a 10-year draw period followed by a 20-year repayment period. There is no initial draw requirement.
Borrowers will receive checks for their HELOC account. Funds are also accessible through online banking, the TD Bank app or in person at a branch.
» MORE: Best HELOC lenders
Alternatives to a TD Bank HELOC
Borrowers interested in a large national HELOC lender may be a fit for Bank of America, which is the number one HELOC lender by origination according to data collected by Inside Mortgage Finance.
Alternatively, borrowers who want to apply entirely online without going to a branch may want to explore a HELOC from Citizens Bank.
HELOCs offer a flexible way to access home equity over a period of time and pay interest only on the funds you withdraw. However, rising interest rates can bump up your monthly payment, and, as with credit cards, it takes discipline to avoid overspending.
Alternatives to home equity lines of credit include a home equity loan, which offers a lump sum with a fixed rate or a cash-out refinance, which replaces your existing mortgage with a larger loan.
TD Bank offers home equity loans and cash-out refinances.
NerdWallet’s HELOC star ratings are awarded by the editorial team based on the following evaluated factors: HELOC volume, combined loan-to-value ratio, whether a fixed-rate option is available, lender fees, initial draw requirements, flexibility of draw and repayment terms, digital application availability, customer support options and transparency to consumers on key factors. A recent regulatory action against a lender may affect its HELOC star rating.
