Citizens Survey Finds Young Homeowners Most Likely to Apply for HELOCs 


Roughly 77% of millennials are likely to apply for a HELOC within next three years, according to a survey recently conducted by Citizens Bank.

As interest rates continue upward, home equity lines of credit (HELOCs) remain a popular tool for U.S. homeowners looking to access a flexible borrowing option. The new study, which measures homeowner sentiment around HELOCs, cash-out refinances and other issues impacting homeowners, shows that 84% of homeowners have some level of familiarity with HELOCs, and, of those familiar, nearly half (46%) consider themselves likely to apply in the next three years, with younger generations as the most likely.

Current homeowners also ranked personal loans side by side with HELOCs (69%) and personal bank loans (69%) among their preferred loan alternatives. 

“Homeowners are following their home’s equity more closely as prices fluctuate, and the growing HELOC space is a testament to that,” says Adam Boyd, head of home equity lending at Citizens, in a statement. “We are fully committed to the HELOC space as demonstrated by our leading offerings and this survey, which shows Millennials and Gen Z are continuing to adopt the HELOC product or consider applying as rates change their homeowner goals and ambitions.” 

Millennials and Gen Z Embrace HELOCs as Rates Move Upward 

The survey found that younger generations are far more likely to consider applying for a HELOC, including 60% of Gen Z and 77% of Millennials, citing that they were likely to apply in the next three years.

Generations had different expectations on how they would or previously have used HELOCs with Millennials (45%), Gen Xers (54%) and Boomers (38%) reported using the product most for home renovations, whereas Gen Zers were more likely to consider the product to help build their savings funds (39%).  

Despite Market Volatility, Homeowners are Staying Put 

As homeowners navigate today’s fluctuating real estate market, Citizens also found that 68% of those surveyed do not plan to sell their home in the next five years, indicating hesitation and the slow-moving inventory the U.S. continues to face. As HELOCs can also be used for a range of uses, the survey found renovations are the most popular usage among all ages (43%) and likely to grow as many homebuyers stay in their homes longer and seek customizations.  

“With homeowners facing record inflation levels it’s important that they create strategies to streamline existing debts into manageable payments and that’s possible through a HELOC,” said Boyd. “HELOCs are popular right now because they provide homeowners with a low-cost solution to access their home’s equity for financing needs without impacting the rate on their mortgage.” 

Consumers Remain Confident in their Mortgage Payments  

Amid fears of a potential economic downturn, many homeowners surveyed felt confident in their ability to pay their mortgage over the next 12 months, with 52% feeling completely confident and 6% feeling not too confident or not at all confident. 

Rising Interest Rates Drive Homeowners to Renovate 

As refinancing wanes due to rising interest rates, many consumers are also considering HELOCs as an alternative to draw cash funds. Among those who previously used a cash-out refinance, homeowners most often put the funds toward a renovation (33%), debt consolidation (31%) or savings funds (27%). 

Regarding mortgage interest rates, more than one-third (35%) of those surveyed said their current rate was between 2-4%. Only 8% of homeowners surveyed have a rate assigned at 6% or higher and 22% have a rate between 4-6%. 

The survey was conducted for Citizens by Wakefield Research among 1,000 nationally representative U.S. homeowners, October 14-23, 2022, using an email invitation and an online survey.

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