loanDepot Adds Home Equity Loan to its equityFREEDOM Suite of Home Equity Products

July 15, 2024 at 12:50 PM EDT

Enables homeowners to tap record levels of equity while maintaining lower primary mortgage rates

loanDepot, Inc. ("LDI" or "Company") (NYSE: LDI), a leading provider of home lending solutions that enables customers to achieve their financial and homeownership goals, today introduced a new home equity loan to its equityFREEDOM product suite. Americans hold a record $32.7 trillion¹ in home equity and of those who are still paying a mortgage, 63% carry an interest rate below 4%². The equityFREEDOM Home Equity Loan, along with the equityFREEDOM Home Equity Line of Credit (HELOC), gives those homeowners powerful financial tools to lower their cost of borrowing without sacrificing their current mortgage rate.

“Being a homeowner brings certain advantages, one of which is access to more tools for managing your financial health and wellness,” said LDI President Jeff Walsh. “Most Americans are feeling the pinch of inflation. In fact, non-housing related consumer debt has skyrocketed to nearly $5 trillion³ as families lean on high-interest credit cards and personal loans to cover their living costs. When used wisely, home equity borrowing can be a sorely needed source of relief, which is why we’ve added to our home equity lending portfolio with this new home equity loan.”

How consumers save vs. credit card debt⁴

With the average credit card interest rate in the country sitting at more than 24%⁵, homeowners with $50,000 in credit card debt could save more than $21,000 in interest over a three-year period by opting for a home equity loan. And, in many cases, the interest may be tax deductible.⁶

	Credit Card	Home Equity loan⁷
Balance	$50,000	$50,000
APR	24.21%	9.99%
Interest paid over 3 years	$36,178	$14,604
ESTIMATED INTEREST SAVINGS		$21,574

The equityFREEDOM Home Equity Loan application takes just minutes and lets customers access the equity in their homes in a lump sum through a 20-year, fully amortizing loan with no prepayment penalty. This loan can be used for large expenses such as home renovations, consolidation of high-interest credit card debt and personal loans, medical bills, or college tuition. It allows homeowners to borrow up to $350,000, based on their credit profile and their home’s combined loan-to-value ratio (CLTV), with a maximum of 90%, meaning a borrower may utilize up to 90% of the total available equity in their property between their first and second mortgage.

The equityFREEDOM Home Equity Line of Credit (HELOC) can take customers from quote to close in as little as three weeks, with flexible terms providing access to equity with a three-year draw period and, in most states, a 10-year interest-only payment period followed by a 20-year amortizing repayment term⁸. Homeowners may borrow up to $250,000, with a maximum of 90% CLTV.⁹

Said loanDepot Chief Education Officer Alec Hanson, “Every borrower has their own unique financial considerations. One may want the stability of the home equity loan’s fixed monthly loan payment, while another may need the flexibility of the HELOC, with the ability to pay down and redraw over time. For this reason, it’s really critical that borrowers work with a reputable mortgage professional who offers different product options and the consultative wisdom borrowers need to make the right decision for their short and long-term financial goals.”

loanDepot will continue to expand its equityFREEDOM suite of home equity lending products with a first lien home equity line of credit due to launch later this summer.

About loanDepot

loanDepot (NYSE: LDI) is a leading provider of lending solutions that make the American dream of homeownership more accessible and achievable for all, especially the increasingly diverse communities of first-time homebuyers, through a broad suite of lending and real estate services that simplify one of life's most complex transactions. Since its launch in 2010, the company has been recognized as an innovator, using its industry-leading technology to deliver a superior customer experience. Our digital-first approach makes it easier, faster and less stressful to purchase or refinance a home. Today, as one of the largest non-bank lenders in the country, loanDepot and its mellohome operating unit offer an integrated platform of lending, loan servicing, real estate and home services that support customers along their entire homeownership journey. Headquartered in Southern California and with hundreds of local market offices nationwide, loanDepot’s passionate team is dedicated to making a positive difference in the lives of their customers every day.

¹ As of Q1 2024, according to the Federal Reserve Bank of St. Louis, available at https://fred.stlouisfed.org/series/OEHRENWBSHNO.

² The Lock-In Effect of Rising Mortgage Rates, FHFA Staff Working Paper 24-03 (March 2024) available at https://www.fhfa.gov/sites/default/files/2024-03/wp2403.pdf.

³ As of Q1 2024, according to the Federal Reserve Bank of New York, Center for Microeconomic Data, available at https://www.newyorkfed.org/microeconomics/hhdc.

⁴ Average credit card APR for new card offers = 24.84% per Lending Tree on 7/8/24; HELoan example based on a 20-year fixed rate 2 mortgage with an initial balance of $50,000.

⁵ LendingTree data available at https://www.lendingtree.com/credit-cards/study/credit-card-debt-statistics/.

⁶ loanDepot encourages consumers to consult tax advisors for applicable requirements and details.

⁷ Unlike a credit card, home equity loans and home equity lines of credit require borrowers to pledge their homes as collateral for the debt.

⁸ In Texas, loanDepot’s HELOC includes a three-year interest only period followed by a 27-year repayment period.

⁹ loanDepot advises consumers that credit criteria, exclusions, and limitations apply; not all property types are eligible collateral; loanDepot’s equityFREEDOM products may not be available in all states; and terms and conditions are subject to change.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240715702489/en/

“Being a homeowner brings certain advantages, one of which is access to more tools for managing your financial health and wellness.”

Contacts

Jonathan Fine

VP, Public Relations

(781) 248-3963

jfine@loandepot.com

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loanDepot Adds Home Equity Loan to its equityFREEDOM Suite of Home Equity Products

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