What are typical HELOC costs and fees?

A HELOC typically comes with an appraisal fee ($300–$700+), application or origination fee ($0–$500), annual fee ($50–$100 at some lenders), and possibly an early termination fee if you close the line within 2–3 years. Many lenders advertise 'no closing cost' HELOCs but may roll costs into the rate or require you to keep the line open for a minimum period.

A Home Equity Line of Credit (HELOC) uses your home's equity as collateral for a revolving credit line. The CFPB's HELOC consumer guide notes that lenders must provide a consumer information booklet and a disclosure of all fees at application. Costs vary significantly by lender — some banks actively compete on 'no closing cost' HELOCs, while others have a more traditional fee structure.

Common HELOC fees

Appraisal fee: $300–$700+ to determine current home value — required by the lender. Some lenders use automated valuation models (AVMs) and waive this fee.
Application or origination fee: $0–$500 at most lenders; some charge nothing upfront.
Title search / title insurance: $300–$1,000+ — less common on HELOCs than on first mortgages, but required by some lenders.
Annual fee: $50–$100 at lenders that charge one — ongoing fee to keep the line active.
Early termination / closure fee: $300–$500 if you close the HELOC within 2–3 years of opening — some lenders waive closing costs only if you keep the line open for a minimum period.
Inactivity fee: A few lenders charge if you don't draw on the line within a certain period.
Transaction fee: Typically $0 per draw at most lenders.

The variable rate cost

HELOCs are variable-rate products — the interest rate moves with the Prime Rate, which is set based on the federal funds rate target. During periods of rising rates (as seen 2022–2023), HELOC borrowers saw their effective interest costs rise substantially. The variable rate is the ongoing cost that matters most if you carry a balance — fees are typically one-time or minor. As of mid-2025, Prime Rate was 7.5% — most HELOCs price at Prime + a margin. Verify current rate conditions at federalreserve.gov.

'No closing cost' HELOC — what it means

Many lenders advertise no-closing-cost HELOCs. This typically means the lender absorbs the closing costs (appraisal, title) — but the catch is usually an early termination clause: if you close the line within 2–3 years, you reimburse those costs. Read the early termination clause before accepting. The 'no cost' offer is genuine if you plan to hold the line for several years.

Your home is collateral

A HELOC is secured by your home. Defaulting on a HELOC can result in foreclosure, even if your first mortgage is current. Borrow against home equity with the same care you would apply to your primary mortgage.

CFPB disclosure requirements

Under TILA, lenders must provide HELOC applicants with a consumer information booklet and an early disclosure document listing all fees, the maximum rate, the payment terms, and the annual percentage rate. — CFPB — HELOC Consumer Guide
The Federal Reserve publishes the H.15 Selected Interest Rates release, which tracks the Prime Rate and other benchmark rates used to price variable-rate products including HELOCs. — Federal Reserve — H.15 Selected Interest Rates

Key takeaways

HELOC upfront costs are typically lower than a purchase mortgage — appraisal ($300–$700) and small fees, often zero at competitive lenders.
The real ongoing cost is the variable interest rate — HELOC rates move with Prime Rate; rising rate environments substantially increase carrying costs.
'No closing cost' HELOCs usually have an early termination clause — read it.
Annual fees ($50–$100) and inactivity fees vary by lender — ask upfront.
Your home is collateral — treat HELOC debt with the same care as your mortgage.

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