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Home Equity Line of Credit


Use the equity you've built in your home to access funds for major expenses with a 10 year line of credit followed by a 20 year repayment period.


In order to take advantage of this offer, you'll need to become a PenFed Member

To become a member, you need only fulfill two requirements:

1. Determine your eligibility

2. Open a Regular Share Account with at least $5

Owner Occupied Homes

Combined Loan to Value (CLTV)
Line Amount Rate1

70% or Less CLTV

$ - $

Variable % APR (Prime + .25%)

70.01% to 80% CLTV

$ - $

Variable % APR (Prime + .50%)

80.01% to 85% CLTV

$ - $

Variable % APR (Prime + 1.00%)

85.01% to 90% CLTV

$ - $

Variable % APR (Prime + 1.5%)

1 Prime Rate is % as of . There is a minimum rate floor of % APR and a maximum rate of % APR.

Non-Owner Occupied Homes

Combined Loan to Value (CLTV)2
Line Amount Rate3

80% or Less CLTV

$ - $

Variable % APR (Prime + 1.5%)

2 The Loan to Value(LTV) is capped at 75% in TX.

3 Prime Rate is % as of . There is a minimum rate floor of % APR and a maximum rate of % APR.


  • Loans from $25,000 - $500,000
  • 10 year draw period and 20 year repayment period
  • Interest only payments during 10 year draw period
  • Switch from a variable to a fixed rate on all or some of your line of credit

• PenFed pays most closing costs

• $99 annual fee, waived if $99 in interest was paid during the preceding 12-month period.

• Available funds when you need them.

Disclosures Print Icon Print

Closing Cost Credit: PenFed will pay most closing costs associated with an interest only home equity line of credit (HELOC) which includes credit report, flood certification, settlement/closing, property ownership and encumbrances search, recording, property search, and quick close. Member is responsible for any city, county and/or state taxes if the subject property is located in FL, LA, MD, MN, NY, TN, or VA. If an appraisal is required, the member, who is responsible for the fee whether or not the loan closes, will pay the cost. The member is responsible for notary fees. Should this loan be paid off or closed within 36 months from the anniversary date of the loan closing, the member will be obligated to reimburse the full amount of the PenFed paid closing costs for the loan.

Interest may be tax deductible, consult a tax advisor for further information regarding the tax deductibility of interest and charges.

Home equity lines of credit (HELOC) are variable rate loans and the interest rate is subject to increase after consummation of the loan on monthly basis. Closing costs range between $500 and $8,500 for credit lines of $500,000. Contact a representative for additional details.

† Annual Fee: Notwithstanding the foregoing, an annual fee of $99 will be assessed on each account anniversary if $99 in interest was not paid during the preceding 12-month period
Appraisals: PenFed will attempt to establish value via an independent method. If that method is unsuccessful or the value is not sufficient for the amount requested, an appraisal will be required regardless of CLTV. An appraisal is always required in the following circumstances:
• For all loans with a loan amount greater than $250,000.

If an appraisal is required it must be ordered by PenFed. You will be contacted for authorization and payment prior to ordering. Appraisal fees average $150 to $525 (some run higher).

Fixed Rate Advance Lock-In You may lock in an Annual Percentage Rate for Advances during the Advance Period. During your Advance Period, you may choose to have three separate Fixed Rate Advances locked in at any one time, with a maximum of two new Fixed Rate Advances per calendar year. Each Fixed Rate Advance must equal or exceed Ten Thousand Dollars ($10,000.00) and you may not request a Fixed Rate Advance that would cause the amount you owe to exceed your Credit Limit. The only term option for your Fixed Rate Advance is 240 months (“Fixed Rate Advance Term”). However, the term of your Fixed Rate Advance cannot exceed your Repayment Period.

Fixed Rate Advances will be amortized over the Fixed Rate Advance Term with the payment consisting of principal and interest. Your Annual Percentage Rate for a Fixed Rate Advance will be calculated by adding your Prime Rate, your Margin and the Additional Fixed Rate Lock-In Margin. Your Annual Percentage Rate for a Fixed Rate Advance shall not exceed 18% and shall be equal to or greater than 3.75% for primary residences and second homes and 4.75% for investment properties.

Property Insurance: Property insurance is required.

PenFed Mortgage Aggregate: If the total combined PenFed indebtedness for real estate loans against the collateral property exceeds $750,000 then the maximum CLTV is 80%. This total indebtedness includes a PenFed 1st mortgage, the new requested loan amount and any outstanding PenFed equity loan products.

Multiple PenFed Loans: Multiple PenFed Equity loans and HELOCs are available as long as the member and collateral qualify (except Texas). For Equity loans and HELOCs the total indebtedness cannot exceed $500,000 for all PenFed Equity and HELOCs combined.

PenFed does not lend on:

• Mobile homes
• Co-ops or time-shares
• Properties that are currently listed on the market for sale
• Commercial property or property used for commercial purposes, even if a residence is part of the property
• Undeveloped property (land only)
• Properties with more than 4 units

Properties that are currently under major construction/renovations: Property must be fully livable, with no safety issues. (Examples: no missing rails from stairs/decks, no open walls with wires showing, missing kitchen appliances/counters, missing bath fixtures or unfinished pool).

Interest Only Home Equity Line of Credit:

• This Account has a Draw Period of 10 years, followed by a repayment period of 20 years.
• If only minimum payments are made during the draw period, the loan balance will not decrease.
• In Texas, the maximum CLTV available is 80% on owner occupied properties and 75% on non-owner occupied properties. Additional restrictions apply in Texas, so please ask a representative for details.
• In all other states, the maximum CLTV is 90% on owner occupied properties and 80% on non-owner occupied properties.
• Property type of Condo has a maximum CLTV of 80%; except for Texas non-owner, occupied properties are 75%.
• The maximum CLTV available is dependent on credit qualification.
• Rates vary depending on owner occupancy and CLTV.

Minimum Loan Amount Requirements in all States:

• For an owner occupied property the minimum loan amount is $25,000 and the maximum amount is $500,000 with a CLTV of 85% or less of the fair market value and a maximum of $250,000 with a CLTV of 85.01 to 90.00%.

• For a non-owner occupied property the minimum loan amount is $25,000 and the maximum amount is $500,000 with a CLTV up to 80% of the fair market value.

Other terms and conditions apply; call 800-970-7766 to speak with a representative for details. All rates and offers are as of September 20, 2019 and subject to change without notice. To receive advertised product you must become a member of PenFed.

We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.

Refinance Loan on Mortgages

Posted October 2019

What Are My Options?

It is important to consider the types of loans, and how they fit in with your goals.

  • Fixed Rate is a home loan with a rate that never changes.
  • Adjustable Rate Mortgage (ARM) is a home loan that has an initial interest rate that is fixed for a set period of time and then is subject to adjustments at set intervals, where the rate can go up or down.

Cash-Out Refinancing is a little different. This type of refinancing option replaces your existing loan with a new one for a larger amount. In order to do this, you must have built up equity in your home. For example, Joe Smith’s home has a value of $200,000 and his existing mortgage balance is $100,000. Since he has paid off $100,000 of his mortgage, this means he owns, and has $100,000 in home equity. If Joe refinances his loan for $150,000, he receives that extra $50,000 in cash at closing, which can be used towards home improvements or paying off a debt. Remember, when considering cash-out refinancing, you need to take into account closing costs.    

What are some additional costs to keep in mind when refinancing?

In order to prepare yourself to refinance, keep in mind these additional costs –

  • Closing costs
  • Application fee
  • Title search fee
  • Inspection fee
  • Attorney and lender fees
  • Prepayment penalties on your old payment

How do I apply?

If you have come to a decision, and are ready to apply, visit PenFed.org to get started.   


To receive any advertised product, you must become a member of PenFed Credit Union. Federally Insured by NCUA. ©2019 PenFed Credit Union

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