PROS / TD Bank offers overdraft protection on its HELOCs.
CONS / Even if you apply online, you have to close in person at a branch.
VERDICT / TD Bank offers home equity loans and HELOCs at competitive rates and with some benefits not found with other lenders. However, it has state-specific restrictions, and even if you apply online, you still have to visit a branch to close your loan.
TD Bank offers home equity loans and home equity lines of credit (HELOC) in 15 states and Washington DC. It is one of the few lenders that lets you use a second home or investment property as collateral. Because TD Bank’s home equity loans are flexible in its requirements and it rated well on our customer experience scores, this lender receives the Top Ten Reviews Silver Award.
Rates & Fees
As part of our ranking of the best home equity loans, our reviewers compared the rates and fees of each lender. We considered factors such as the interest rates on fixed- and variable-rate loans as well as maintenance, closing and application fees. TD Bank received an 80 percent for its home equity loan rates and fees. TD Bank scored slightly higher than the average of 77 percent. It offers both fixed and variable rate loan, with rates that are comparable with the other lenders in our lineup.
Where TD Bank’s score fell is when its fees are compared to those other lenders charge. TD Bank is more likely to charge application, closing and early payoff fees than other lenders.
Our reviewers compared the eligibility requirements of each lender and created a score based on those requirements. Requirements we compared include the maximum loan-to-value ratio, the maximum debt to income ratio, the minimum credit score and the minimum amount of equity. TD Bank scored 80 percent in this category, which is roughly average for this category. Of the lenders we compared, TD Bank has the highest minimum equity to be eligible for a loan. This means you may not be eligible for a loan if you haven’t been living in your home for very long. TD Bank does accept a higher loan to value ratio than the industry average of 80 percent.
TD Bank is one of the few lenders on our review that allows you to get a home equity loan or home equity line of credit on a second home or investment property. It’s important to know that TD Bank currently offers home equity loans and HELOCs to residents of 15 states and Washington D.C., so you’ll want to be sure these loans are available in your state before you apply.
Our loan specifications score looks at the maximum and minimum amounts offered by a lender for both home equity loans and HELOCs. TD Bank received the highest score in our lineup, this means you can get loan amounts that can fit your need. If the loan crosses a certain threshold, you may be required to pay other fees. The draw period and repayment period for TD Bank’s HELOC is average for these type of loans.
If you are getting a HELOC based on a budget, you may run into unexpected expenses, from the extra six yards of carpet to overtime the contractor charges because he underestimated the complexity of wiring your house for CAT 6 cable. Thus, you could exceed your loan amount without realizing it, especially if you are paying with a HELOC-attached charge card. If you are concerned this may happen, you can get an EquityAccess PLUS account, which covers those accidental overdrafts so your project can continue. This is the only home equity lender we reviewed that offers such protection.
This is also the only bank we reviewed that is so state-specific that it won't give any information on its website until after your state of residence is established. Others lenders simply note the differences between states in the disclaimers, but this site directs you to a state-specific home equity page from the start. Its variable interest rates are also dependent on your home state. We queried rates in several states, and interest rates for the same loan varied by as much as 0.25 percent.
TD Bank has branches in 15 states plus Washington D.C., and you will want to make sure there is a branch near you even if you're applying online, as the application takes you through the process, then requires you to visit a branch to close anyway. The email contact form does not allow "special" characters, such as question marks or commas. We also received an email reply intended for a different customer, making us question the security of the contact form process. However, the phone system was easy to use, and the agents were knowledgeable and willing to answer questions.
TD Bank offers home equity loans and lines of credit at rates comparable to those of its competitors and for amounts that are greater than some banks offer. The HELOC overdraft protection is a unique and useful feature. While we found the online contact and application processes to be problematic, contacting the brokers over the phone was easy. If you have a branch in your area, TD Bank is worth considering.