What lenders look at
A home equity loan is a second mortgage, so lenders look at the whole picture. They want to see enough equity left in the home, steady income, manageable debts and a good payment history.
The most you can borrow depends on the loan type and purpose, and a loan consultant can tell you yours.
CapCenter's home equity basics
- Fixed rate, paid out as one lump sum
- Loan amounts from $50,000 to $250,000
- 15-, 20- and 30-year terms
- Single-family primary residences and second homes
- Not available on investment properties, condos, 2-4 unit homes or manufactured homes
- Up to four borrowers on one loan
Timing rules to know
Your first mortgage must have been in effect for at least six months before the home equity loan closes. The home also can't have been listed for sale in the six months before you apply.
Your first mortgage matters too. It can't be a HELOC or a reverse mortgage, and it can't be in forbearance or have an interest-only feature.
Debt-to-income with the new loan
Hypothetical example. APR may differ; example only. Rates change daily.
Say you earn $9,000 a month, your first mortgage is $2,200 and your other debts are $600. Adding a $75,000 home equity loan at 8% for 15 years, about $717 a month, brings your debt-to-income ratio to about 39%.
Example details: $75,000 15-year fixed home equity loan at 8.000% (8.055% APR): 180 monthly payments of $716.74. Principal and interest only; taxes and insurance not included, so the actual payment will be higher. Unless noted, APR assumes ZERO Closing Costs, no discount points and 15 days of prepaid interest. Hypothetical example prepared November 4, 2026, not a current CapCenter rate offer; subject to credit approval.
Documents to gather
- Recent pay stubs and W-2s, or tax returns if you're self-employed
- Bank statements
- Your current mortgage statement
- Homeowners insurance details
- Proof of other income, such as retirement or rental income, if you use it
Valuation
Lenders need to confirm what your home is worth. With CapCenter, a full appraisal isn't needed in most cases, because an automated valuation can often do the job.
If your home needs a closer look, for example after major changes or in an area with few recent sales, an appraisal may still be ordered. Keeping a list of recent upgrades and repairs handy can help either way.
Common reasons an application stalls
- Not enough equity for the amount you want
- Debt-to-income too high once the new payment is added
- Recent late payments on your mortgage
- The home was recently listed for sale
- The property type isn't eligible
