If a Home Equity Loan or HELOC Isn't Available or Fast Enough, Is a Personal Loan a Better Alternative?
A personal loan can be a reasonable alternative when a home equity loan or HELOC isn't available or fast enough, since it usually funds within about a week without an appraisal, but it typically costs meaningfully more because it isn't secured by your home. Home equity financing is generally the cheaper route when you can wait for it, while a personal loan can make sense when speed matters more than the rate, or when tapping equity isn't an option.
Last updated July 22, 2026Which Option Costs Less?
Home equity loans and HELOCs are secured by your house, so lenders can offer lower rates because the loan carries less risk for them. Personal loans are unsecured, meaning there's no collateral backing them up, so lenders charge more to offset that risk. As of mid-2026, home equity loans and HELOCs commonly run in the roughly 7% to 12% range depending on your credit and how much equity you have (loan-to-value, or LTV). Personal loan rates are typically higher across the board, often landing somewhere around 12% for borrowers with excellent credit up to the high teens or beyond for fair or lower credit, with published surveys showing a wide overall range depending on the lender and your credit profile. Rates change often, so treat any specific number as a rough guide rather than a quote.
Which Option Funds Faster?
Personal loans generally move faster because most lenders don't require a home appraisal. Many personal loan lenders can approve and fund a loan within about one to seven days, sometimes even the same day, once your application and documents are in. Home equity loans and HELOCs usually take longer because most lenders order a home valuation or full appraisal before approving the loan, and that step alone can add days to weeks depending on your area and the lender's process.
It Depends on Your Situation
- You need money in the next few days and can accept a higher rate. A personal loan is likely the faster path since it skips the appraisal step.
- You have equity available and can wait a bit longer for funding. A home equity loan or HELOC is typically the lower-cost choice over time.
- You don't have enough home equity, don't own a home, or your mortgage lender doesn't offer this product. A personal loan may be your main option; some lenders in our network that focus on mortgage lending don't offer personal loans directly and will point borrowers to other providers for that product.
- You're weighing a small, short-term need versus a large expense. Smaller amounts may make sense as a personal loan given the shorter time to funding, while larger amounts often favor the lower rate of home equity financing even with the wait.
| Secured by your home? | Yes |
|---|---|
| Typical rate range (as of 2026-07) | Roughly 7% to 12% |
| Appraisal usually required? | Yes, in most cases |
| Typical time to funds | Days to a few weeks |
Related questions
- HELOC vs home equity loan vs cash-out refinance
- how Does a Reverse Mortgage Work, and How Does It Compare to Other Equity Options
- can I still pull equity out of my home if I already have a reverse mortgage, even if my current reverse-mortgage lender won't help
- is the Interest on a Home Equity Loan or HELOC Tax Deductible
- what determines your mortgage rate quote
Sources
- https://www.experian.com/blogs/ask-experian/heloc-vs-personal-loan-which-is-better
- https://www.navyfederal.org/makingcents/home-ownership/heloc-home-equity-loan-vs-personal-loan.html
- https://www.federalreserve.gov/releases/g19/current/
- https://www.consumerfinance.gov/ask-cfpb/what-is-a-home-equity-line-of-credit-heloc-en-107
- https://themortgagereports.com/97647/heloc-appraisal-requirements
- https://www.cnbc.com/select/6-personal-loans-thatll-get-you-funded-in-as-little-as-1-business-day
- https://wallethub.com/edu/iti/average-personal-loan-interest-rate/91711
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.