How much does a $200,000 home equity loan cost per month, post-Fed rate cut (and is it worth opening)?

With the average homeowner currently in possession of approximately $313,000 worth of equity – and the average lender capping the amount they can borrow at 80% – there's still around $250,000 worth of home equity that owners can borrow from now.

And if they do so with a home equity loan, they'll lock in a fixed interest rate that's significantly lower than what they can qualify for with a personal loan or credit card. Still, borrowing this much money from your most important financial investment needs to be done judiciously, and the numbers need to be calculated properly to determine long-term affordability.

That second item is essential right now, considering the Federal Reserve's new interest rate cut campaign. Not only did the central bank issue a rate cut in September, but it's also positioned to issue additional ones in October and December. So borrowing an amount like $200,000 now will not only be significantly below the cap most lenders mandate, but it will be less expensive, too. 

So, how much does a $200,000 home equity loan cost per month now that the Fed cut rates again? And, perhaps more importantly, is it worth opening for homeowners? Below, we'll break down the answers to both questions.

Start by seeing how much home equity you'd be eligible to borrow here.

How much does a $200,000 home equity loan cost per month, post-Fed rate cut?

A home equity loan's fixed interest rate makes it easy to calculate monthly costs. Here's how much a $200,000 home equity loan will cost per month now, calculated against two available rates and repayment periods:

• 10-year home equity loan at 8.34%: $2,462.63 per month
• 15-year home equity loan at 8.21%: $1,935.63 per month

For context, here's what a home equity loan of this size would have cost earlier this year, in March 2025:

• 10-year home equity loan at 8.52%: $2,481.85 per month
• 15-year home equity loan at 8.45%: $1,963.62 per month

And here's what it would have cost in October 2024, in the weeks after the Fed's September rate cut:

• 10-year home equity loan at 8.46%: $2,475.44 per month 
• 15-year home equity loan at 8.37%: $1,954.27 per month

So while payments here are both cheaper than they were six months ago, and are cheaper than they were six months before that, the approximate cost differential isn't substantial. Still, rates here are moving in the right direction for borrowers, and loans can be refinanced in the future should rates decline materially. So, this can still be the smart way to borrow a large amount of money currently.

See what home equity loan rate you'd be eligible for here.

Is a $200,000 home equity loan worth opening now?

The answer to this question is a personal one that's dependent on multiple specific factors. If you're a homeowner with the average amount of equity in your home, then withdrawing this much without a viable payoff plan can be dangerous. Your home is collateral in this exchange, and foreclosure is an option if you can't make your payments as agreed to.

On the other hand, if you have an above-average equity amount now, the ability to make payments with relative ease and want to pay as little in interest as possible, then a $200,000 home equity loan could be advantageous for you. This is especially true if you're planning to use it for approved home repairs and projects, which may result in a sizable tax deduction.

Determine which type of borrower you are, then, and consider speaking with a financial advisor or lender to better inform your decision.

The bottom line

A $200,000 home equity loan comes with monthly payments ranging from roughly $1,936 to $2,463 for qualified borrowers now. And while that's less expensive than they were in March 2025 and October 2024, they're not materially different, either. Carefully consider your needs and goals before getting started with a home equity loan of this size. It won't be the right move for many homeowners, but for those who can afford it, it can be one of the better ways to borrow a large, six-figure sum right now.