Insights
September 01 2025
Homeowners are getting savvier with their equity in 2025 and for good reason. With high credit card interest rates and housing values holding strong, tapping into home equity has become one of the smartest ways to manage money. According to fresh survey data from MeridianLink, homeowners are planning to use home equity in the following ways in 2025:
Here’s a closer look at how today’s homeowners are putting their home equity to work:
It’s no surprise that home renovations are a top reason homeowners tap into their equity. Take a midrange kitchen remodel as an example—it might cost $40,000, financed at a 9% interest rate. The real payoff comes in the appraisal: if your renovation increases your home’s value by $50,000, the appreciation more than covers the cost of borrowing. Plus, you get to enjoy your newly renovated kitchen. With home prices holding steady or rising in many areas, smart upgrades can be an investment, not just a cost.
Credit card debt has hit record highs, and with APRs averaging 24% or more, homeowners are using equity as a strategic refinancing tool. Replacing $18,000 of traditional credit card debt with a 9% Trovy Card could save you around $2,000 a year in interest. It’s not just about lower rates, it’s about smarter control of your money. With a home equity line of credit, you get a flexible credit line, backed by your home, with the power to knock down your monthly payments without adding new constraints.
Some savvy investors are treating their home equity like an asset. That might mean using it as a down payment on a rental property or dipping into the market when there’s a correction. With a HELOC, homeowners can bridge the financing gap for new real estate investments. You draw only what you need, when you need it, and pay interest accordingly. It’s controlled leverage, with a clear exit strategy. Used wisely, this kind of access can accelerate wealth-building without compromising stability.
Life is unpredictable. That’s why many homeowners are using home equity to establish a ready line of credit for the unexpected, like a surprise medical bill or an urgent home repair. Unlike a traditional personal loan, which requires a new approval each time, a home equity line of credit provides an always-available line you can draw from when needed. It’s faster than typical personal loan underwriting and doesn’t penalize you for being prepared. Think of it as your “just in case” fund, without the drag of paying interest on money you’re not actively using.
Not all expenses are emergencies. Some are just mistimed. A child’s tuition payment comes due and you don’t have the cash on hand to pay for it. Instead of draining emergency funds, selling your investments or maxing out credit cards, homeowners are using equity lines to bridge the gap. You cover the expense now, and pay it down over time. It’s a savvy way to stay on top of responsibilities without derailing your financial plans.
Whether you’re planning renovations, looking to consolidate debt, or want to build an emergency fund, your home equity could be the key to achieving your financial goals in 2025. The flexibility of a home equity line of credit gives you access to funds when you need them, with competitive rates that can save you thousands compared to alternatives like credit cards or personal loans.
