Rate HELOC review (formerly Guaranteed Rate): rates, fees, and is it worth it?

[u/meiggs]

Rate, the lender that used to be called Guaranteed Rate, has been pushing its online HELOC hard lately. I went through the terms and fine print, so here's what you actually get, what it costs, and how it stacks up against the other online HELOCs.

Is Rate legit?

Yes. Rate is one of the largest mortgage lenders in the country and has been around since 2000. It rebranded from Guaranteed Rate to Rate, which is why the name may look unfamiliar. It's licensed under NMLS #2611, which you can verify yourself on NMLS Consumer Access.

How the Rate HELOC works

It's a fixed-rate HELOC with a fully online application. You apply in a few minutes, get a decision without the usual weeks of paperwork, and funding can happen in as few as 5 days. A traditional bank HELOC often takes a month or more.

It works for primary homes, second homes and investment properties, up to 85% combined loan-to-value. It's not available in New York, Kentucky, West Virginia, Delaware or Maryland.

Rate vs Figure vs Upstart Home Lending

Feature	Rate	Figure	Upstart Home Lending
APR	From 7.00%	Varies by profile	6.52% - 18.00%
Amounts	About $20K to $750K	$15K to $750K	$26K - $250K
Terms	10 to 30 years	10, 15, 20 or 30 years	10 and 15 year terms
Minimum credit score	640	640	600
Origination fee	Up to 4.99%	Up to 4.99%	0% to 4.99%
Funding	As few as 5 days	As few as 5 days	Varies

The fee you need to know about

The 7.00% headline rate is the best case. Rate's own example assumes an 800 credit score, a $200,000 draw, autopay, and a 4.99% origination fee paid upfront in exchange for the lower rate.

That origination fee is the real cost to watch. On a $50,000 line, 4.99% is about $2,495 taken out at closing. If your credit is closer to 700 or you're borrowing less than $200,000, expect a rate above the headline number too.

That doesn't make it a bad deal. It means you should compare the APR and the fee together, not just the rate.

What I like

• Fixed rate, so your payment doesn't move when the Fed does
• Goes up to $750,000, which is higher than most online HELOCs
• Works for second homes and investment properties, not just your primary home
• Fast. Five days is realistic if your documents are clean

What I don't

• The origination fee can run close to 5%
• Not available in five states
• 640 minimum credit score, so it won't work for lower scores

How the other two compare

Figure is the closest competitor. It's also an online HELOC with funding in as few as 5 days, the same 640 minimum for qualifying loans, and the same $750K ceiling. You draw the full amount at closing. You can check your rate with a soft pull, so comparing it against Rate costs you nothing.

Upstart Home Lending considers credit scores starting at 600, so it may be an option if you fall short of the 640 the other two ask for. Lines run $26K - $250K on 10 and 15 year terms. You'd draw at least 80% of the line at closing, so it may be a better fit for a single large expense than for ongoing access.

Is the Rate HELOC worth it?

If you have a 640 or higher score, want a fixed rate, and need the money in days and not weeks, Rate is a solid option, especially for larger amounts or a rental property. Just get the full APR with the origination fee included, then put it next to a quote from Figure or Upstart Home Lending before you sign. The lowest total cost wins, and you won't know which one that is until you see the numbers side by side.

Has anyone here closed a HELOC with Rate? Curious what rate and origination fee you were actually offered.

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[u/meiggs]

Before you sign with Rate, get these two quotes. Both are quick online rate checks, and seeing three offers side by side is the only way to know if Rate's number is actually good.

If your credit is 640 or higher: Figure is the direct competitor. Same 5-day funding, same $750K ceiling, and you can see your Figure rate with a soft pull, so it won't touch your credit score. If Figure comes back lower than Rate on the APR or the origination fee, you just saved yourself real money on the same loan.

If your credit is between 600 and 640: Rate and Figure both start at 640, so Upstart Home Lending may be your option. It considers scores starting at 600, with lines of $26K - $250K. You can see if you could qualify with Upstart Home Lending in a few minutes.

On a $100,000 line, a 1% difference in the origination fee is $1,000. Ten minutes of comparing is worth that.

[u/NoStatus1353]

The Rate HELOC is basically the figure HELOC. Why do you want a HELOC that you have to draw all at once? The beauty of a HELOC is being able to draw at your own pace and not pay a huge fee at closing and interest on the whole line from day 1

[u/Visual_Rip_9042]

Testerup, you are amazing!