Achieve expands fixed-rate HELOC with $700,000 cap

Achieve has expanded its fixed-rate home equity line of credit (HELOC) program, raising the maximum loan amount to $700,000 and lowering its lowest available annual percentage rate to 5.5% for qualified borrowers, the digital personal finance company said Wednesday.

The changes, which took effect June 2, also increase borrowing flexibility by allowing qualified homeowners to access up to 90% of their home’s value and raising the maximum debt-to-income ratio to 50%.

The latest update marks Achieve’s second major enhancement to its HELOC product this year. In April, the company increased loan limits to $500,000 and reduced interest rates across several credit tiers.

“Our previous loan limit increase has been well received by homeowners and investors alike and we feel confident this latest increase to $700,000 will give qualified borrowers greater flexibility to use their home equity in ways that align with their financial goals,” Kyle Enright, president of lending at Achieve, said in a statement.

Achieve’s fixed-rate HELOC differs from traditional HELOCs by offering fixed interest rates and fully amortizing monthly payments for the life of the loan. The company said the structure is designed to help borrowers avoid payment increases associated with variable rates, interest-only periods and balloon payments.

The product can be used for debt consolidation, home renovations and other large expenses.

Along with the higher loan limits, the company highlighted several features of its HELOC offering, including a minimum credit score requirement of 600, loan closings in as little as seven business days, and terms ranging from 10 to 30 years with no prepayment penalties.

Borrowers can draw funds for up to five years and may apply online or by phone. Achieve also uses automated valuation models in place of traditional in-person appraisals for many loans, which the company said helps reduce underwriting times and costs.

The expanded terms are currently available through Achieve’s direct-to-consumer channel and are expected to be offered later this year through Achieve Pro, the company’s planned third-party origination platform.

“As we continue building our national TPO platform, enhancements like higher loan limits make our fixed-rate HELOC even more compelling for our lender partners and their clients,” said Nectar Kalajian, managing director of Achieve Home Loans.

“Homeowners are looking for flexible ways to access home equity, and mortgage professionals want products that can serve a wider range of borrower needs. Expanding our maximum loan amount strengthens our ability to support both.”

Achieve said its HELOC product is available in 31 states and covers nearly 80% of the U.S. population.

This article was generated using HousingWire Automation and reviewed by a HousingWire editor before publication.