KeyBank: 2024 Home Equity Review

Highlights

Products offered

Home equity loan, HELOC, rate-lock HELOC

Repayment terms

Home equity loan: Five to 30 years; HELOC: 15-year draw period, 15-year repayment period

APR

From 10.29% for home equity loans; From 11.70% for HELOCs

Contact info

888-539-0018

KeyBank, a Cleveland-based financial institution, offers both home equity loans and home equity lines of credit (HELOCs) to qualifying homeowners. While its home equity loans are limited to 15 states, its HELOCs are available in 44. Whichever product you choose, you can borrow up to $500,000 through KeyBank.

With its extensive product offers and streamlined application process, KeyBank made our list of the best lenders for home equity loans and HELOCs.

KeyBank: At a glance

Types of loans offeredHome equity loan, HELOC, rate-lock HELOCAPRHome equity loan: From 10.29%HELOC: 11.70%Loan amountHome equity loan: $25,000 to $500,000HELOC: $10,000 to $500,000Credit score minimumN/ARepayment termsHome equity loan: Five to 30 yearsHELOC: 15-year draw period, 15-year repayment periodAverage time for approvalN/A

As of March 21, 2024.

KeyBank is best suited for people who seek a longer repayment term because it offers borrowers a 30-year repayment option on its home equity loan. It also offers a low minimum loan amount of $10,000 for its HELOC, which is ideal if you only need access to a smaller amount of money and don’t want to pay interest withdrawing additional funds they won’t be using.

Pros

Interest rate discount: If the borrower, or a family member who lives in the house, opens a KeyBank checking and savings account, the bank will shave 0.25% off their interest rate.

Fixed-rate option: Although KeyBank’s HELOCs have variable interest rates, the bank allows you to lock the interest on some or all of your loan amount.

Low minimum loan amount for HELOCs: The minimum loan amount for a HELOC is $10,000, which is useful if you don’t need a lot of cash for small projects such as a home office renovation. When a HELOC has a higher minimum, a homeowner might take out more money than they need, which they also have to pay interest on.

Cons

Limited availability: The bank offers home equity loans in only 15 states: Alaska, Colorado, Connecticut, Idaho, Indiana, Maine, Massachusetts, Michigan, New York, Ohio, Oregon, Pennsylvania, Utah, Vermont and Washington. HELOCs are available in every state except Alabama, Arizona, California, Nevada, Texas and the District of Columbia.

High minimum loan amount for home equity loans: If you’re a homeowner who needs less than $25,000, you can’t get a KeyBank home equity loan.

Early termination fee: You’re required to reimburse KeyBank for any third-party fees it paid on your behalf if you pay off your home equity loan or HELOC in full and close your account within 36 months of opening it.

Home equity loan options

Home equity loan: Homeowners can borrow between $25,000 and $500,000 at a fixed rate with a KeyBank home equity loan. Repayment terms range from five to 30 years. KeyBank allows a maximum loan-to-value ratio, or LTV, of 80% for home equity loans.

HELOC: KeyBank’s HELOC has a 15-year draw period and 15-year repayment period. You can borrow between $10,000 and $500,000 at a variable interest rate. KeyBank allows HELOCs borrowers to have a maximum LTV of 90%.

Rate-lock HELOC: Along with its standard variable-rate HELOC, KeyBank also offers a rate-lock HELOC, allowing you to lock in a fixed rate on a portion or all of your loan balance during the draw period. The bank also gives you the option of making interest-only payments during this time.

The bank also offers a construction loan for home renovations, which not all banks provide as an option.

Fees

KeyBank charges a $295 origination fee for home equity loans, and depending on the amount of your loan, you may also have to pay title insurance premiums.

You can expect to pay a $50 annual fee to keep your HELOC open, but otherwise you won’t have to worry about closing costs unless you work with a closing agent. If you opt for a closing agent, you may be charged closing costs up to $400.

If you close your home equity loan or HELOC within 36 months of opening it, KeyBank will charge you a fee, though it doesn’t disclose the amount.

How to qualify

Although KeyBank doesn’t disclose its minimum credit score requirements, many lenders will consider scores starting in the mid-600 range, provided you have sufficient home equity (usually at least 15% to 20%) and adequate, steady income. You can apply for a home equity loan or HELOC with KeyBank as long as you live in one of its qualifying states and have current hazard insurance on your property.

How to apply for a home equity loan or HELOC with KeyBank

You can apply online or in person at one of KeyBank’s 1,000 branches. You’ll need the requisite paperwork to be approved for a home loan, such as your recent Form W-2, pay stubs and tax returns to verify your income and employment, as well as any documentation pertaining to your existing mortgage.

If you open a KeyBank checking and savings account during the process, you can receive a 0.25% discount on your interest rate.