TD Bank: Review on Home Equity Loans and HELOCs

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Good for price transparency
TD Bank
TD Bank
Good for price transparency
TD Bank
  • Products offered:
    Home equity loan, HELOC, interest-only HELOC, rate-lock HELOC
  • Home equity loan terms:
    5, 10, 15, 20, or 30 years
  • HELOC loan terms:
    10-year draw period, 20-year repayment period
  • Maximum LTV:
    89.99%

NextAdvisor’s Take

Pros
  • Options to apply in person, on the phone, or online
  • 0.25% rate discount if you set up auto-pay from a TD account
  • No credit check required to see personalized rates and fees
  • Many products and options available
Cons
  • Only offered in 15 states
  • $99 origination fee for both home equity loans and HELOCs
The Bottom Line

Primarily operating on the East Coast,  TD Bank is one of the 10 largest banks in the U.S. and serves more than 9.7 million customers. TD Bank offers Home Equity Loans and HELOCs in 15 states, with the option for interest-only and rate-lock HELOCs. Loan amounts for home equity loans start at $10,000, while line amounts for HELOCs start at $25,000.

For a home equity loan or HELOC with TD Bank, closing costs only exist on loan amounts greater than $500,000, but you will be required to pay a $99 origination fee at closing regardless of your loan amount. There is also an annual fee of $50 on HELOCs unless your loan amount is less than $50,000. You’ll be charged an early termination fee of 2% of the outstanding balance if your HELOC is closed within 24 months from opening. Additionally, you’ll receive a 0.25% rate discount if you set up auto-pay from a TD personal checking or savings account. 

If you decide to apply for a TD Bank home equity loan or HELOC, you can do so online, by phone, or by visiting a TD Bank in person. The online application includes a calculator that will tell you the maximum amount you can borrow based on the information you input, but you can also see a full breakdown of rates, fees, and monthly payments by entering some basic information online. No credit check is required for this service. 

Though its nationwide availability is limited, we like TD Bank because it has a wide variety of product offerings — including interest-only and rate-lock options on its HELOCs. The bank’s good online user experience and price transparency make it easy to work with this lender,  and the customer service is very accessible.

Editorial Independence

As with all of our home equity loan and home equity line of credit (HELOC) lender reviews, our analysis is not influenced by any partnerships or advertising relationships. For more information about our scoring methodology, click here.

TD Bank Full Review 

If you’re on the East Coast and looking for a home equity loan or line of credit (HELOC), TD Bank could be worth exploring. Serving 9.7 million customers in 15 states, the bank funds home equity loans starting at $10,000 and HELOCs starting at $25,000. Although it doesn’t operate nationwide, TD Bank made our list of the best home equity lenders thanks to its variety of product offerings, smooth online user experience, and accessible customer service.

TD Bank: Home Equity Loan Products

While some lenders offer either home equity loans or HELOCs, TD Bank provides both. Home equity loan amounts start at $10,000, while HELOC amounts start at $25,000. 

On a home equity loan, you can choose repayment terms ranging from five to 30 years. HELOCs, meanwhile, have a 10-year draw period and a 20-year repayment term. 

TD Bank also offers interest-only HELOCs and rate-lock HELOCS. With an interest-only HELOC, you only have to pay interest on the amount you withdraw during your draw period. Once that period ends, you’ll start making full payments on both the principal and interest. 

A rate-lock HELOC lets you lock in part or all of the amount you borrow at a fixed rate. This option can be useful if you borrowed in a rising rate environment and don’t want your variable rate to get too high. 

Whichever type of product you choose, you can have a maximum loan-to-value (LTV)  ratio of 89.99%. LTV compares the amount of your loan with the value of your home. 

If you set up autopay on your loan or line of credit from a TD Bank checking account, the bank will give you a 0.25 percentage point discount on your interest rate. 

TD Bank: Home Loans Rate and Fee Transparency

TD Bank has a transparent lending process, allowing you to check your rates with no impact on your credit score. Its online application will show you the full amount you can borrow, along with a breakdown of rates, fees, and monthly payments after you enter some basic information online. 

When lenders let you check your rates online, it helps you compare offers and make better borrowing decisions. It’s worth noting, however, that prequalification doesn’t guarantee an offer. Your loan terms could change after you submit a full application. 

TD Bank also clearly discloses the fees associated with its home loan products. Both home equity loans and HELOCs come with an origination fee of $99. You’ll pay closing costs on loan amounts greater than $500,000, as well as an annual fee of $50 on HELOCs over $50,000. 

If you close your HELOC early (within 24 months of opening), you’ll also be subject to an early termination fee of 2% of your outstanding balance. Understanding the fee structure on a loan or line of credit is important before you borrow, as high fees could offset the savings you get from a low interest rate. 

Along with checking your rates online, TD Bank also gives you the option of applying for a home equity loan or HELOC online, over the phone, or in-person at a TD Bank branch. 

TD Bank Compared to Other Home Equity Lenders

TD BankPNC BankU.S. Bank
HELOC Interest-only HELOC, Rate-lock HELOCFixed rate HELOC, Variable rate HELOC Variable rate HELOC
Home Equity Loan YesNoYes
States Available15 states 44 states (not available in Alaska, Hawaii, Louisiana, Nevada, Mississippi, South Dakota)45 states (home equity loans not available in Hawaii, Louisiana, New York, Oklahoma and Rhode Island)​​
Loan Amount RangeLoans start at $10,000, HELOCs start at $25,000$10,000 – $1,000,000$15,000 – $750,000 (up to $1,000,000 for properties in California)
HELOC Loan Terms10-year draw period20-year repayment period Repayment period of 5 – 30 years (5 – 20 years in Tennessee)10-year draw period; repayment period unspecified
Max LTV89.99%89.9% (80% or 85% in some states)80%
Data in table accurate as of Dec. 22

How to Get the Best Home Equity or HELOC Rate  

Shopping around for a home equity loan or HELOC can help you find the lowest rate. Here are some tips for finding the best lender and loan offer for you. 

Compare Products Offered 

Before you start loan shopping, make sure you understand the difference between a home equity loan and a HELOC. A home equity loan offers a lump sum upfront, which you pay back in monthly installments over time. It can be a good option for a project with fixed, predictable costs. 

A HELOC, on the other hand, is a line of credit that you can draw on as needed and pay off as you go. It might be a better fit if your project has variable costs or you want to access cash in the event of an emergency. 

Knowing which loan product meets your needs can help you narrow down your list of lenders, as some institutions offer only one or the other. 

Shop for Multiple Lenders 

Before borrowing a loan, it’s always a good idea to shop around with multiple lenders. Rates, terms, and eligibility requirements vary, so comparing your options can help you find an offer that’s the best fit. 

Many lenders let you check your rates online via prequalification, meaning you can get a sense of your offers with no impact on your credit score. If you decide to submit multiple full applications (which involve hard credit inquiries), try to keep them within a 45-day window to protect your credit score. 

Use a Loan Calculator 

Once you have some loan offers, use an online loan calculator to estimate your costs. With a calculator, you can estimate your monthly payments and long-term interest charges. You might also see your amortization schedule, or how your payments will be applied toward your principal balance and interest charges from month to month. 

Taking the time to estimate your costs can help you choose a loan that fits your budget. If the monthly payments seem steep, you might keep searching for a lender with a lower rate or reduce the amount you borrow. 

Only Borrow What You Need 

Make sure to only borrow what you need and no more. Even though some lenders will allow a high LTV, that doesn’t mean you should borrow up to the limit. 

Over-borrowing against the equity of your home is risky, since you could lose your home if you can’t pay back the loan. If your home value drops, furthermore, you could find yourself underwater. 

Improve Your Credit Score

Lenders typically assign the best rates on home equity loans and HELOCs to borrowers with the best credit. If you can go into the loan shopping process with a strong credit score, you’ll have a better chance of scoring a good rate. 

In the FICO scoring model, a good score starts at 670, a very good score starts at 740, and an exceptional score starts at 800. Your credit score is based on a number of factors, including your history of payments and amounts owed. 

Steps such as making on-time payments on loans, paying off debt, and reducing your credit utilization ratio can all help your score. If you find any errors on your credit report, furthermore, you could try disputing them to have them removed. 
Spending a few months improving your credit score before you apply for a home equity loan or HELOC could be worth it if it leads to better rates and terms.