HELOC Requirements Checklist: Income, Credit & Equity

The 4 Pillars of Approval

Getting a HELOC is harder than getting a mortgage. Because it is a "Second Lien," banks take on more risk, so they scrutinize you harder. Here is what you need to pass the test.

1. Equity (Max 85% CLTV)

You must have at least 15-20% equity left over after the loan.
Formula: (Primary Mortgage + New HELOC) / Home Value < 0.85.

2. Credit Score (680+)

While some lenders go down to 620, most major banks want 680 or higher.
760+ Credit: Gets the best interest rates (Prime + 0%).
680-759 Credit: Gets standard rates (Prime + 1%).

3. Debt-to-Income (DTI < 43%)

Your total monthly debt payments cannot exceed 43% of your gross monthly income. This includes the new HELOC payment.

4. Income History

You need 2 years of consistent employment history. If you are self-employed, see our Self-Employed Guide.