HELOC Annual Fees, Inactivity Fees and Early-Closure Fees: What Lenders Charge (2026)

In this Article

• What Fees Can a HELOC Charge After You Open It?
• What Is a HELOC Annual Fee?
• Which HELOC Lenders Charge Annual or Early-Closure Fees?
• How Can You Avoid a HELOC Annual Fee?
• Can a Lender Charge a HELOC Inactivity Fee?
• What Is a HELOC Early-Closure Fee?
• Should You Close a HELOC Now or Wait Out the Fee?
• What Other HELOC Fees Should You Watch For?
• Can Your Lender Add or Raise HELOC Fees Later?
• Are HELOC Fees Tax Deductible?
• How Do You Compare HELOC Fees Before You Apply?
• HELOC Fee FAQ

What Fees Can a HELOC Charge After You Open It?

A HELOC can charge an annual fee, an inactivity fee and an early-closure fee after you open it, plus smaller fees for things like rate locks, transfers and late payments.

Fees are only part of the cost. See what APR you could qualify for before you apply.

A HELOC (home equity line of credit) is a credit line secured by your home. Most attention goes to the rate and the closing costs, but some of the fees show up years later. These are the ones to know:

• Annual fee. A yearly charge to keep the line open, whether you use it or not.
• Inactivity fee. A charge for not drawing on the line for a set period. Allowed, but uncommon.
• Early-closure fee. A charge for closing the line within the first few years. Sometimes it takes the form of repaying the closing costs your lender covered.
• Rate-lock fees. A charge to move part of your balance to a fixed rate, or back.
• Draw and transfer fees. A charge for moving money out of the line.
• Late and returned-payment fees.

Your lender has to list every fee it charges to open, use or keep your line in the disclosures you get before you sign. That list is the best place to start.

What Is a HELOC Annual Fee?

A HELOC annual fee is a yearly charge, usually $50 to $99 at the lenders we checked, that you pay to keep your line open whether or not you owe anything on it.

Comparing HELOC offers? Start by checking the APR you could get. It won’t affect your credit score.

Annual fees work a little differently from lender to lender:

• When it starts. Many lenders skip the first year and charge on each anniversary after that.
• How long it lasts. Some charge only during the draw period, the years when you can borrow.
• How it’s paid. Some lenders bill it. Others add it to your balance, which means you pay interest on it too.

A small fee matters more when your balance is small. Here is what a yearly fee adds to your cost, measured as a share of what you owe:

On a line you keep open “just in case,” a $75 fee adds up to $750 over 10 years. That can be a fair price for an emergency backup, but only if you might use it. See our guide to a standby HELOC as an emergency fund.

Which HELOC Lenders Charge Annual or Early-Closure Fees?

Many big HELOC lenders charge either an annual fee or an early-closure fee, and a few charge both, so compare the two together rather than picking a lender for one missing fee.

Add another lender to your comparison. Check your HELOC APR in minutes.

Here is what 10 lenders publish:

Lenders change their fees, and your own agreement controls, so confirm before you apply. For more on each online lender, see our reviews of Figure, PenFed, Spring EQ and Aven.

How Can You Avoid a HELOC Annual Fee?

You can avoid a HELOC annual fee by choosing a lender that doesn’t charge one, meeting your lender’s waiver rules, or asking your lender to waive it.

Shopping around is the easiest way to avoid fees. See what a HELOC could cost you.

The lenders we checked offer a few ways out:

• Keep a qualifying checking account. U.S. Bank waives its fee with a Platinum Checking Package. Citizens waives its fee with a Private Client, Private Bank or Quest checking account.
• Use the line. PenFed waives its $99 fee if you paid at least $99 in interest over the past year.
• Pick a lender with no annual fee. Bank of America, Navy Federal, Figure and Aven list none.
• Ask. A long-time customer with a good payment history can call and ask for a one-time waiver. The lender doesn’t have to agree, but it costs nothing to ask.

Texas homeowners have extra protection, because the Texas constitution limits fees on home equity lines. That’s why some lenders, like PNC, skip the annual fee in Texas. Arizona has no similar rule, so Arizona homeowners pay the standard fees.

Can a Lender Charge a HELOC Inactivity Fee?

Yes, a lender can charge a HELOC inactivity fee, because the federal ban on inactivity fees covers credit cards, not lines of credit secured by your home.

Not sure how much you’ll draw? See what credit line and APR you could qualify for.

An inactivity fee is a charge for not using your line, usually after a year or so without a draw. Federal rules stopped credit card companies from charging these fees, but that rule applies only to cards that are not secured by a home. A HELOC is secured by your home, so the ban doesn’t apply.

In practice, inactivity fees are uncommon. None of the 10 lenders in our table lists one, and Navy Federal says outright that it doesn’t charge one. The Consumer Financial Protection Bureau still lists them as a fee some lenders charge, so check your agreement.

There is good news, too. Federal rules list the only reasons a lender can close your HELOC and demand repayment: fraud, failing to repay, or something you do that hurts the lender’s security, like letting your home insurance lapse. Not using the line isn’t on that list. A lender can freeze or reduce a line for other reasons, such as a big drop in your home’s value, but it can’t end your account just because you haven’t drawn on it.

What Is a HELOC Early-Closure Fee?

A HELOC early-closure fee is a charge for closing your line within the first few years, usually 24 to 36 months, to help the lender recover the costs of opening it.

Thinking of replacing your HELOC? Check whether a new APR would make up for the fee.

Lenders that pay your closing costs, or charge none, often protect themselves with this fee. It comes in three main forms:

• A flat fee. Bank of America charges $450, plus taxes and recording fees, if you close within 36 months.
• A percentage, with a cap. U.S. Bank charges 1% of your original line, up to $500, within 30 months. TD Bank charges 2% of your balance, up to $450, within 24 months.
• Closing-cost recapture. PNC and PenFed have you repay the closing costs they covered if you close within 36 months. Ask for that dollar amount in writing, because it can be higher than a flat fee.

The fee is tied to closing the account, not to paying it off. You can pay your balance down to zero at any time and keep the line open without triggering it. The fee usually comes up when you:

• Close the line on purpose, even with a zero balance.
• Refinance with another lender, because the new loan pays off and closes your line. See our HELOC refinance guide.
• Sell your home, because the line is paid off and closed at the sale. Some lenders, like TD, waive the fee when you sell.

Should You Close a HELOC Now or Wait Out the Fee?

You should usually wait to close a HELOC until the early-closure window ends, because keeping a paid-off line open for a few more months often costs less than the fee.

Before you close, see what APR you could get on a new line.

Compare two numbers: the early-closure fee, and the annual fees you would pay before the window ends.

Waiting isn’t always possible. If you’re refinancing or selling, the line has to close, and the fee goes on your payoff statement. In that case, count the fee as a cost of the refinance or sale. When you do close, send a written request and confirm the lien release. See what to do after you pay off a HELOC.

What Other HELOC Fees Should You Watch For?

Besides annual and early-closure fees, watch for fees to lock or unlock a fixed rate, fees to move money out of the line, late fees and release or recording fees when you pay it off.

Once you know the fees, compare the APR. Check yours without affecting your credit score.

Examples from lenders we checked:

• Rate-lock fees. PNC charges $100 to move a balance to a fixed rate after opening, and $100 to unlock it. Other lenders charge nothing. See how to convert a HELOC to a fixed rate.
• Transfer and cash-out fees. Aven charges 2.5% to move money to a bank account or transfer a balance.
• Late fees. Aven’s late fee is $29. Most lenders charge one.
• Release and recording fees. TD notes third-party fees of $0 to $600 or more to record the release of your lien when you pay off and close.
• Fees added to your balance. Spring EQ adds its annual fee to what you owe, so you pay interest on it until you pay it off.

Some lenders also require a minimum draw when you open the line or each time you borrow. That isn’t a fee, but it affects your cost, because you pay interest on money you may not need yet.

Can Your Lender Add or Raise HELOC Fees Later?

Your lender generally can’t add or raise HELOC fees after you open the line, because federal rules lock in your terms at signing except in a few narrow cases.

Read the fee terms before you sign. See what you could qualify for first.

Under the federal rules for HELOCs, a lender may change your terms after opening only if:

• The change clearly helps you, like lowering a fee or raising your limit.
• The change is insignificant, like an operational detail that doesn’t make your terms worse.
• Your agreement already spelled it out, such as a fee that starts after the first year.
• You agree to a specific change in writing at the time it’s made.

That means a fee that isn’t in your agreement shouldn’t appear later. If it does, ask your lender which section of your agreement allows it. If you aren’t satisfied, you can submit a complaint to the Consumer Financial Protection Bureau.

The same rules mean your fees are worth reading before you sign, not after. Your lender must list every fee to open, use or keep the plan in your disclosures, in dollars or as a percentage, along with when each one is due.

Are HELOC Fees Tax Deductible?

HELOC fees are generally not tax deductible, because the IRS treats charges for services connected to a loan as fees, not interest.

Planning a project? See how much you could borrow with a HELOC.

IRS Publication 936 says amounts a lender charges for specific services connected to a loan, like appraisal and notary fees, aren’t interest and can’t be deducted as mortgage interest. Annual and early-closure fees are charges for keeping or closing an account, not interest on what you borrowed.

HELOC interest itself is deductible only if you itemize and used the money to buy, build or substantially improve your home. See our guide to HELOC interest tax deductibility and talk with a tax professional about your situation.

How Do You Compare HELOC Fees Before You Apply?

To compare HELOC fees, add up every fee you expect to pay over the years you’ll keep the line, not just the closing costs, and compare that total across at least three lenders.

Ready to compare? Check your HELOC APR in minutes.

Use each lender’s fee disclosure to answer these questions:

1. Is there an annual fee? How much, when does it start, does it last past the draw period, and how can you get it waived?
2. Is there an early-closure fee? How much, how long does the window last, and is it waived if you sell or refinance with the same lender?
3. Did the lender pay your closing costs? If so, will you have to repay them if you close early, and what’s the dollar amount?
4. Is there an inactivity fee or a minimum draw?
5. What do rate locks, transfers and late payments cost?
6. What’s the margin? Fees matter, but the margin, the amount added to the prime rate, usually costs more over the life of a line. Check today’s averages on our Arizona home equity rates page.

For lenders to start with, see our lists of the best Arizona HELOC lenders and the fastest HELOC lenders.

HELOC Fee FAQ

EquitySquirrel is an educational resource operated by Scout Media LLC, not a lender. This content does not constitute financial, legal, tax, or lending advice. HELOCs are secured by your home, and missed payments can result in foreclosure. Lender fees are summarized from lender websites and EquitySquirrel’s lender reviews as of October 2026, may vary by state and line size, and may change; your HELOC agreement controls. Federal rules described here come from Regulation Z and IRS Publication 936. Confirm current terms directly with lenders. Consult a licensed financial or tax professional before making decisions about your home equity. Aleksandra Kadzielawski, Lic #SA694336000.