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U.S. homeowners tapped nearly $25 billion in home equity through second-lien mortgages during the first quarter of 2025 — the largest volume for this period in 17 years, according to the ICE Mortgage Technology‘s newest Mortgage Monitor report. That marks a 22% increase compared to the same quarter last year.
The first quarter is typically the slowest for home equity lending, but lower interest rates in early 2025 helped to boost activity — particularly for home equity lines of credit (HELOCs) — and set a strong tone for the rest of the year.
“Equity levels remain historically high, and now we’re seeing the cost of borrowing against the equity drop meaningfully,” Andy Walden, head of mortgage and housing market research at ICE, said in a statement.
HELOC rates have fallen by 2.5 percentage points in recent quarters and dropped below 7.5% in March, according to ICE. On a $50,000 line of credit, the monthly interest-only payments have dropped by $100 since early 2024 to reach $311 at the start of Q2 2025.
If the Federal Reserve moves forward with three rate cuts and spreads remain steady, rates could dip into the mid-6% range by early 2026 — roughly on par with projected 30-year mortgage rates, ICE reported.
In total, U.S. mortgage holders carried a record $17.6 trillion in home equity entering the second quarter, up 4% from a year earlier. Of that, $11.5 trillion is considered “tappable,” meaning it can be borrowed against while preserving at least 20% equity in the home.
About 48 million mortgage holders have some level of equity, with an average of $212,000 in tappable equity available per borrower. According to a separate ICE survey, roughly one-quarter of homeowners are considering taking out a home equity loan or HELOC in the next year.
“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,” said Tim Bowler, president of ICE Mortgage Technology.
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