bank rates

Nationwide Bank 3.25% HELOC

A home equity line of credit is the cheapest way to borrow money right now — if you can get one.

And Nationwide Bank has about the best deal around on HELOCs — if you can get one.

The Columbus, Ohio, bank is offering 3.25% APR to homeowners with good credit (a FICO score above 720) and at least 20% equity in their homes based on its current appraised value.

Its line of credit is available in all states, carries no annual fee, and pays the first $750 in closing costs, including the appraisal. That should be enough to cover everything, everywhere except in New York and Florida.

The minimum line of credit is $5,000 and you can borrow up to 80% of the equity in your home. (Example: If your house is worth $150,000 and you still owe $100,000, you’d have $50,000 in equity. Eighty percent of that would be $40,000.)

The fine print: If you close the line of credit before the 24-month limit, you will pay a $300 fee. And all HELOCs are variable-rate loans, so if interest rates go up, your HELOC will become more expensive.

Lines of credit are usually sold as the prime rate plus or minus a percentage point or two. In this case, Nationwide is charging prime plus 0 points.

That means interest rates would have to go up a lot to make this a bad deal.

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Comments (6)
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6 Existing Comments
  1. Ian said:
    on April 7th at 05:39 pm

    Actually, you can only borrow up to 80% of the value of your home, minus the balance of any prior liens. That means that if your home is worth $150,000 and you owe $100,000 in prior liens, you would be able to borrow $20,000 on your HELOC. ($150,000 x .80 = $120,000 – $100,000 = $20,000) The ad is a little confusing, but the footnote at the bottom reads (in part):

    “Total line of credit not to exceed 80% of the appraised value of the property minus any existing mortgage balances.”

  2. RateRunner said:
    on April 8th at 04:37 pm

    Ian: You are right. Good catch. Thanks for sharing.

  3. JF said:
    on April 18th at 05:45 pm

    1)Good rate. Although a couple of others are offering a better rate. e.g Third Federal savings bank is offering HELOC at Prime minus 0.25. No fees. But they dont conduct business in California.
    So, if someone knows equally good rates or better, I would like you to Post it here whenever appropriate.

    2) has anyone dealt with Nationwide on HELOC? If so, what is yuor experience?

  4. Pete said:
    on May 14th at 01:37 am

    Penfed has a great one if you can join the credit union. The best I have seen for CA is this one at Nationwide or Schwab.

  5. JF said:
    on May 22nd at 03:03 pm

    Here is my experience with Nationwide Bank.

    What this doesn’t tell you is that it is not easy to qualify for their HELOC even if you have a SUPERIOR credit score and LOW LTV. The telephone call connects you with high power, financial sales people who would not give you any pertinent information such as Debt to Income requirement for it’s HELOC or any other relevant information to that matter. All they want you to do is “submit” an application and find out later!
    I got suckered into it and at a cost of one Inquiry on my Credit Report, I found out that no matter how good your credit score is and no matter how low the LTV is, Nationwide requires a Bebt to Income ratio of 40% or less. What’s more, in calculating the debt monthly payment, they amortize the entire Line amount at a whopping rate of 1.5% a month ( i.e 18% per annum) ..even though they are offering the HELOC at a rate of 3.25%. So, the Loan officer hastily told me that my application was not approved. What a joke!!

    Most lenders I talked to, go up to 50% Debt to income and calculate the debt payment at a rate of between 6% – 10% per annum, amortized over 20 years..depending on who you go with. But what’s important is that they readily made this information available before hand. So, the consumer can decide whether they want to go forward or not.

    I wish someone had posted this kind of information here before I submitted my application to this lousy bank and it’s rude,abrupt and unfriendly Loan officers. However, the Sales people were quite polite but very pushy..I got the impression that part of their compensation is tied to how many applications they submit.

    But what bothers me most is that they could have made this information to the consumer/applicant before hand.

    The sales agent would, at best, give me a vague and evasive information and when pressed to transfer the call to a Loan officer, the latter not only was abrupt and angry and impatient but refused to give me that information.

  6. KS said:
    on May 28th at 07:36 pm

    Nationwide bank has horrible customer service. When you have questions about anything more complex, no one seems to know the answers. I put in 5 phone calls prior to the transaction to insure that I had all of the paperwork to make the process as smooth as possible. Each time, I was given a different answer. After everything was processed, I again called to check on the status, and was told different answers from everyone who looked at my account. I asked them to make notes of my call on the account, they didn’t. I asked to be transferred to a manager, and the person responded, “they can’t do anything more than I can do.” They are just useless in my opinion and I will never give them one cent of my money in the future.